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FIDUCIARY 
ACCOUNTING 

MADDEN 


FIRST    EDITION 


THE  WILLIAM  G.  HEWITT  PRESS 

61-67  NAVY  STREET,  BROOKLYN,   NEW  YORK 
PUBLISHERS 


Fiduciary  Accounting 


BY 


John  Thomas  Madden,  B.C.S.,  C.P.A, 

Assistant  Professor  of  Accounting,  New  York  University, 
School  of  Commerce,  Accounts  and  Finance 


ASSISTED  BY 

Charles  H.  Edwards,  LL.B, 

Of  the  New  York  Bar 


FIRST  EDITION 


1913 

THE  WILLIAM  G.  HEWITT  PRESS 

61-67  Navy  Street,  Brooklyn 

Publishers 


Copyright,  1913,  by 
JOHN  R.  WILDMAN 


PREFACE 

This  syllabus  has  been  prepared  for  the  use  of  students 
in  New  York  University  School  of  Commerce,  Accounts  and 
Finance,  in  the  course  in  Fiduciary  Accounting. 

The  will  accompanying  the  syllabus  has  been  written  for 
use  as  a  basis  for  the  course,  and  brings  out  as  many  possible 
situations  as  are  likely  to  arise  in  the  administration  of  a 
decedent  estate.  Other  technical  points  not  covered  in  the 
operation  of  the  estate  accounts,  as  outlined  in  the  syllabus, 
are  introduced  through  the  medium  of  questions,  many  of 
which  have  been  taken  from  the  C.  P.  A.  examination  papers 
set  in  New  York  and  other  states. 

The  legal  phases  of  the  course  are  treated  from  the  view- 
point of  the  New  York  Statute,  and  certain  essential  parts 
of  the  Code  of  Civil  Procedure,  the  Decedent  Estate  Law,  and 
the  Transfer  Tax  Law,  have  been  incorporated  in  the  syllabus. 

The  legal  forms  accompanying  the  set  include  those  which 
concern  the  accountant,  or  which  require  action  on  the  part 
of  the  executor;  and  forms,  such  as  citations,  which  concern 
the  attorney  only,  have  been  omitted. 

The  syllabus  is  designed  solely  as  an  aid  to  the  instructor 
and  the  students  in  the  practical  laboratory  course  in  the  class- 
room, and  it  is  not  intended  as  a  textbook  nor  as  an  exhaustive 
work  on  the  subject. 

Jno.  T.  Madden. 

New  York  University,  July  i,  191 3. 


2^8V49 


FIDUCIARY   ACCOUNTING 


ESTATE  OF  JOHN  SMART,  DECEASED 

CHRONOLOGICAL  STATEMENT  OF  FACTS 

John  Smart,  who  resided  at  lOO  Washington  Square,  in  the 
City  of  New  York,  died  on  January  15,  191 1.  On  January  17, 
191 1,  the  will  of  the  deceased  was  read,  and  in  this  instrument 
the  following  heirs  and  next  of  kin  were  mentioned : 

Mrs.  Anna  C.  Smart,  widow,  aged  60  years;  Mr.  George 
Smart,  son,  aged  39  years,  married;  Mr.  Oliver  Smart,  son, 
aged  37  years,  unmarried;  Miss  Jane  Smart,  daughter,  aged 
34  years,  unmarried;  Mr.  Thomas  Smart,  son,  aged  31  years, 
unmarried;  Mrs.  Margaret  Jones,  sister,  aged  50  years,  mar- 
ried, residing  at  i  University  Place ;  Mr.  Arthur  Jones,  nephew, 
aged  23  years,  unmarried;  Mr.  William  Smart,  brother,  aged 
44  years,  married,  and  residing  at  23  East  Ninth  Street. 

The  will  also  gives  legacies  to  Robert  Brown,  of  iii  West 
I  nth  Street;  Henry  Robinson,  222  West  222d  Street;  Charles 
Robinson,  222  West  222d  Street ;  Walter  Mead,  aged  25  years, 
and  Richard  Mead,  aged  30  years,  both  of  545  Fifth  Avenue. 

The  will  also  mentioned  Miss  Mary  Smart,  daughter,  who 
died  five  days  prior  to  the  death  of  the  testator. 

All  of  the  above  resided  in  the  State  of  New  York,  with 
the  exception  of  George  and  Oliver  Smart,  both  of  whom 
resided  in  Newark,  N.  J.  The  executors  immediately  notified 
the  insurance  companies  of  the  testator's  death. 

January  19,  191 1 

Application  was  made  for  letters  testamentary;  the  execu- 
tors opened  an  account  in  the  Union  Trust  Company,  in  the 
name  of  the  "Estate  of  John  Smart:  Mrs.  Anna  C.  Smart, 
George  Smart,  Oliver  Smart  and  Charles  Robinson,  Execu- 


Fiduciary  Accounting 

tors."  The  executors,  upon  opening  the  mail  which  had  accu- 
mulated during  the  last  illness  of  the  testator,  discovered  the 
following  checks,  which  are  deposited  to  the  credit  of  the 
estate,  in  the  Union  Trust  Company;  quarterly  dividend  of 
i^%  on  the  stock  of  the  Interurban  R.  R.  Co.,  declared 
December  28;  six  months'  interest  on  the  bond  of  William 
Price ;  check  of  Goldsmith,  Silver  &  Co.  for  rental  of  leasehold 
for  period  ending  January  15,  191 1;  check  from  the  co- 
partnership of  Smart  &  Williams,  for  testator's  proportion 
of  the  profits  for  the  fiscal  year  ended  December  31,  1910, 
$29,824.23. 

February  24,  191  i 

Objection  having  been  made  to  the  service  of  George  and 
Oliver  Smart  as  executors  without  giving  bonds,  on  the 
ground  of  non-residence,  arrangements  are  made  to  secure 
the  executors'  bond.  The  will  is  admitted  to  probate,  and 
letters  testamentary  are  issued  to  the  executors,  who  qualify 
at  once.  They  procure  certified  copies  of  the  will  and  letters, 
the  cost  of  same  being  $34.50.  An  exemplified  copy  of  the 
will  is  filed  in  Iowa,  where  the  testator  held  farm  lands,  cost 
of  same  being  $5.00.  The  executors  insert  the  usual  notices 
for  creditors  in  the  newspapers  designated.  The  legacy  of 
Robert  Brown  is  paid,  voucher  No.  3 ;  Brown  pays  the  amount 
of  the  tax  to  the  executors.  The  following  bills  are  paid: 
Voucher  No.  4,  A.  Dickerson,  funeral  expenses,  $834.27;  Dr. 
L.  Brown,  professional  services,  last  illness,  voucher  No.  5, 
$200.00 ;  voucher  No.  6,  Fidelity  Bond  Co.,  premium  on  execu- 
tors' bond,  $1,645.00.  Owing  to  the  testator's  illness,  the 
following  items  in  connection  with  the  leasehold  property  for 
the  year  ending  January  15,  191 1,  had  not  been  paid :  Voucher 
No.  7,  J.  J.  Sator,  rental,  $7,000.00;  voucher  No.  8,  Jones 
Contracting  Co.,  repairs  to  leasehold  property,  $436.17.  These 
bills  are  paid  at  once  by  the  executors.  Appraisers  for  the 
inventory  are  appointed. 

March  i,  191  i 

Rent  due  on  Henry  Street  property  is  paid,  $200.00;  re- 
ceived check  of  the  insurance  company,  in  settlement  of  policy 


Fiduciary  Accounting 

cf  $20,000.00,  the  amount  received  being  $20,965.00.  Paid 
voucher  No.  9,  Sun  Publishing  Co.,  $53.00;  voucher  No.  10, 
Times  Publishing  Co.,  $53.00,  advertising  for  creditors ;  sewer 
assessments  amounting  to  $4,000.00  are  levied  against  the 
Bronxville  property,  under  date  of  March  i.  Repairs  to 
Henry  Street  property,  amounting  to  $105.00,  are  made  by 
James  Cron,  whose  bill  is  paid.  Dividend  received  on  stock 
of  United  Cigar  Manufacturing  Co.,  at  the  rate  of  i^%. 

March  2,  191 1 

Balance  due  to  the  estate  on  contract  for  the  sale  of  realty 
received  by  executors,  viz. :  Check,  $4,000.00  and  second 
mortgage,  Charles  Stollerman,  interest  6%,  payable  March  i 
and  September  i,  premises  Avenue  A,  Jamaica,  Long  Island, 
recorded  in  Section  2,  Liber  loi  of  mortgages,  page  17,  due 
Sept.  I,  1912,  $5,000.00.  Paid  voucher  No.  12,  Park  &  Til- 
ford,  debt  of  testator,  invoice  of  Jan.  15,  $216.42.  Notice 
of  suspension  of  Skyrocket  National  Bank  received.  The  se- 
curities belonging  to  the  estate  are  transferred  to  the  personal 
representatives,  the  usual  arrangements  having  been  made 
with  the  State  comptroller. 

March  15,  191 1 

The  inventory  is  completed,  and  the  executors  pay  the 
appraisers'  fees,  amounting  to  $75.00,  Vouchers  Nos.  13, 
14  and  15,  John  Doe,  Ralph  Roe  and  Samuel  Straight,  $25.00 
each.  Prepare  the  inventory,  in  the  required  form,  from  the 
following  statement  of  facts: 


ESTATE  OF  JOHN  SMART 

SCHEDULE   OF   PROPERTY 

1.  Cash  on  deposit,  Union  Trust  Co $16,000.00 

2.  Corn  Exchange  Bank,  certificate  of  deposit, 

dated  Jan.  i,  191 1,  bearing  interest  at  3%       25,000.00 

3.  Cash  on  deposit.  West  Side  Savings  Bank. .         3,000.00. 

4.  One  thousand  (1,000)  shares  stock  of  Inter- 


Fiduciary  Accounting 

urban  R.  R.  Co.,  a  New  York  corporation 
— ^par  value  $100.00  each — market  value  at 
date  of  death 115,000.00 

5.  Bond  of  William  Price,  secured  by  mortgage 

on  N.  Y.  City  improved  property,  dated 
July  I,  1 910,  bearing  interest  at  6%,  pay- 
able Jan.  I  and  July  i 20,000.00 

6.  Leasehold,  J.  J.  Sator  to  testator;  made  on 

Jan.  15,  1906,  to  run  for  30  years;  annual 
rental  $7,000.00 ;  lessee,  in  addition,  to  pay 
all  taxes  and  make  all  repairs.  This  prop- 
erty was  sublet  by  the  testator  to  the  firm 
of  Goldsmith,  Silver  &Co.  for  an  improved 
rental  of  $15,000.00;  this  lease  provides 
that  the  testator  shall  continue  to  pay  the 
taxes,  insurance  and  repairs.  In  the  origi- 
nal lease  given  by  Sator  permission  to  sub- 
lease had  been  given  to  the  testator.  An- 
other provision  in  the  contract  allows  the 
testator  to  recover  the  sum  of  $5,000.00 
for  tenant's  improvements  at  the  end  of  the 
period.  All  rentals  are  due  and  payable 
on  Jan.  15,  at  end  of  each  year.  The  an- 
nual average  expense  to  date  has  been  as 
follows  :  Taxes,  $900.00 ;  repairs,  $600.00 ; 
insurance  and  expense,  $400.00.  Money 
for  this  kind  of  property  is  worth  6%. 

7.  One-half   interest   in   the   co-partnership   of 

Smart  &'  Williams;  partnership  entered 
into  on  Jan.  i,  1908,  to  run  for  five  years ; 
each  partner  contributed  $150,000.00; 
profits  are  to  be  shared  equally ;  there  is  a 
provision  in  the  partnership  agreement 
that  the  death  of  a  partner  shall  not  termi- 
nate the  partnership,  but  that  the  survi- 
ving partner  shall  continue  the  business 
until  the  end  of  the  calendar  year  in  which 
such  partner  died. 

8.  Farm  lands  in  Iowa 12,000.00 

9.  New  York  City  improved  realty,  situated  on 


Fiduciary  Accounting 

Henry  Street;  rented  to  Denis  Patterson 
for  $800.00  per  annum,  payable  quarterly, 
in  advance 15,000.00 

10.  Life  insurance  policy,  payable  to  estate 20,000.00 

11.  Life   insurance  policy,   payable  one-half  to 

widow,    one-half    to    surviving    children, 

per  capita 10,000.00 

12.  Residence,  Bronxville 20,000.00 

13.  1,500  shares  stock  United  Cigar  Manufactur- 

ing Co.,  a  New  York  corporation,  $100.00 

par  value,  market  value  at  date  of  death. .     150,000.00 

14.  Contract  for  sale  of  real  property  on  Long 

Island  for  $10,000.00.  The  sum  of 
$1,000.00  was  paid  to  testator  in  his  life- 
time ;  balance  due  on  March  2,  payable  in 
cash,  $4,000.00;  second  mortgage  $5,- 
000.00;  interest  at  6%,  due  Sept.  2  and 
March  2 9,000.00 

15.  Bond  of  James  Kent,  secured  by  mortgage 

on  New  York  City  improved  property, 
dated  April  i,  1910;  interest  5%,  payable 
April  I  and  October  i 3,000.00 

16.  Debt  due  by  representative,  Charles  Robin- 

son, secured  by  his  note,  payable  on  de- 
mand, bearing  interest  at  6%  ;  interest  last 
paid  to  Jan.  15,  191 1,  inclusive 1,500.00 

17.  Household  furniture 3,000.00 

18.  30  N.  Y.  C.  4%  gold  debentures  of  1934 

(interest  payable  May  i  and  November  i), 

at  93>^ 28,050.00 

19.  1,000    shares    Clarion    Manufacturing    Co. 

stock,  par  $100.00,  market  value  $101.00 
per  share,  pledged  as  collateral  for  loan  of 
$100,000.00  from  Union  Trust  Co.  on  6 
months'  note,  due  May  i,  interest  5% 101,000.00 

20.  500  shares  Goldbrick  Mining  Co worthless 

21.  10  shares   Skyrocket   National   Bank  stock, 

par  value  $100.00  per  share 1,500.00 

22.  Contract  for  the  purchase  of  realty  in  Jack- 

sonville,    Florida,     for    $1,000.00,     from 

5 


Fiduciary  Accounting 

J.  Enright;  $500.00  paid  at  time  of  testa- 
tor's death,  balance  due  on  Aug.  i,  191 1. 

23.  Testator's  library 2,500.00 

24.  Clothing  and  personal  effects 5,000.00 

Open  the  Estate  Ledger;  the  number  after  the  name  of 
each  account  indicates  the  number  of  lines  required  for  the 
respective  accounts:  Page  i,  library,  4;  clothing  and  personal 
effects,  4;  household  furniture,  6;  N.  Y.  C.  4%  gold  deben- 
tures, 1934,  7;  bond  of  William  Price,  8;  bond  of  James 
Kent,  7.  Page  2 :  Interurban  R.  R.  Co.  stock,  5 ;  United 
Cigar  Manufacturing  Co.  stock,  5 ;  Clarion  Manufacturing  Co. 
stock,  8;  Goldbrick  Mining  Co.  stock,  8;  Skyrocket  National 
Bank  stock,  6.  Page  3:  Skyrocket  National  Bank,  stock 
assessment,  6;  Union  Trust  Co.  deposit,  14;  Corn  Exchange 
Bank,  certificate  of  deposit,  5 ;  West  Side  Savings  Bank,  de- 
posit, 14.  Page  4:  Mechanics  Savings  Bank,  deposit,  14; 
Ninth  Ward  Savings  Bank,  deposit,  14;  leasehold  property, 
asset  account,  12.  Page  5:  Life  insurance  policy,  4;  contract 
for  sale  of  realty,  10;  debt  due  by  Chas.  Robinson,  5 ;  Goodrun 
Tire  Co.,  stock,  7;  bond  of  C.  Stollerman,  12.  Page  6:  Bond 
of  C.  H.  Keepler,  6 ;  bond  of  C.  R.  Heinz,  6 ;  bond  of  Winan 
Realty  Co.,  6 ;  bond  of  F.  W.  Holden,  6 ;  Robert  Brown,  lega- 
tee, 4;  Margaret  Jones,  legatee,  4;  William  Smart,  legatee,  4. 
Page  7  :  Arthur  Jones,  legatee,  6 ;  Henry  Robinson,  legatee,  7 ; 
Thomas  Smart,  legatee,  3 ;  Jane  Smart,  legatee,  3 ;  Charles 
Robinson,  legatee,  8;  Mrs.  A.  C.  Smart,  legatee,  6;  C.  Robin- 
son, suspense,  4.  Page  8:  Trustees  for  Mrs.  A.  C.  Smart, 
income,  9;  trustees  for  R.  and  W.  Mead,  income,  13;  expense 
income,  16.  Pages  9  and  10:  Expense  principal.  Page  11: 
Debts  of  testator.  Page  12:  Trustee  income,  19;  trustee  prin- 
cipal, 19.  Page  13:  Inheritance  tax  account,  22;  commis- 
sions, 3 ;  Mrs.  A.  C.  Smart,  executrix,  3 ;  George  Smart,  exec- 
utor, 3;  Oliver  Smart,  executor,  3;  C.  Robinson,  executor,  3. 
Page  14:  Estate  of  John  Smart,  decrease  of  corpus,  10;  es- 
tate of  John  Smart,  corpus,  22  \  proceeds  of  sales  of  realty,  7. 
Page  15:  Estate  of  John  Smart,  increase  of  corpus.  Pages 
16  and  17:  Estate  of  John  Smart,  income.  Page  18:  Lease- 
hold property,  income  account,  15. 

The  following  payments  are  made :    Repairs  to  household 

6 


Fiduciary  Accounting 

furniture,  voucher  No.  i6,  E.  Marshall,  $57.40;  postmaster, 
voucher  No.  17,  postage,  $6.00;  Tower  Stationery  Co.,  voucher 
No.  18,  stationery,  $5.47 ;  Benedict  &  Benedict,  insurance, 
voucher  No.  19,  $30.(X),  insurance  premiums  for  one  year. 
Affidavits  for  inheritance  tax  proceedings  on  all  property 
within  the  state  are  secured. 

April  i,  191  i 

The  executors  receive  the  following  checks :  Half-yearly 
interest  on  bond  of  James  Kent;  quarterly  dividend  of  i^%  on 
stock  of  Interurban  R.  R.  Co.  The  executors  hire  a  safe 
deposit  vault  at  the  Monroe  Trust  Company,  and  pay  the 
annual  rental  of  same,  $10.00,  voucher  No.  20.  Paid  to  widow 
on  account  of  income,  $1,500.00,  voucher  No.  21.  Charles 
Robinson  pays  his  debt  to  the  estate,  $1,500.00,  with  interest 
at  6%.  From  receipts  found  among  the  papers  of  the  estate 
the  executors  learn  of  a  safe  deposit  vault  rented  at  the 
Lincoln  Trust  Co.  by  the  testator.  Discovery  proceedings  are 
commenced,  and  it  is  found  that  the  testator  had  placed  in 
this  vault  two  bank  books  showing  the  following  deposits  in 
his  favor:  Mechanics  Savings  Bank,  balance,  with  interest 
to  July  I,  1910,  $507.00;  Ninth  Ward  Savings  Bank,  balance, 
with  interest  to  July  i,  1910,  $1,500.00.  There  was  found, 
in  addition,  a  bank  book  in  favor  of  George  Smart,  John 
Smart,  trustee,  showing  a  balance,  with  accrued  interest  to 
July  I,  1910,  of  $2,020.00.  The  executors  discover  $300.00 
in  cash  in  a  tin  box  belonging  to  the  testator. 

April  15,  191 1 

The  household  furniture  is  sold  at  private  sale  for  $2,745.00. 
The  residence  at  Bronxville  is  sold  for  $30,000.00,  at  public 
auction,  the  buyer  to  pay  the  taxes  for  the  current  year,  as 
well  as  assessments. 

May  I,   191 1 

Check  received  for  semi-annual  interest  on  N.  Y.  C.  4% 
gold  debentures.  Certificate  of  deposit  paid  to  executors,  with 
accumulated  interest,  and  proceeds  deposited  in  the  Union 
Trust  Company.     The  note  held  by  the  trust  company,  with 


Fiduciary  Accounting 

the  Clarion  Mfg.  Co.  stock  as  collateral,  is  paid,  and  the  col- 
lateral released;  interest  paid  on  the  note,  $2,500.00,  voucher 
No.  22.  The  Goldbrick  Mining  Company,  which  went  into 
receiver's  hands  prior  to  the  testator's  death,  makes  its  final 
report,  showing  that  the  stockholders  will  realize  nothing.  The 
stock  of  the  Clarion  Co.  is  sold  at  loij/^,  less  customary  brok- 
erage. An  assessment  of  50%  is  levied  on  the  stockholders 
of  the  Skyrocket  National  Bank,  and  same  is  paid  by  the 
executors. 

May  10,  191 1 

Paid  to  widow  on  account  of  income,  $1,000.00;  debts  of 
testator,  voucher  No.  25,  Lord  &  Taylor,  $200.00.  Paid  to 
J.  Sayles,  auctioneers,  commission  on  sale  of  residence,  $300.00, 
voucher  No.  26. 

June  i,  191  i 

Checks  received  as  follows:  For  rent  of  Henry  Street 
property;  growing  crops  on  farm  in  Iowa  sold  for  $600.00; 
dividend  of  i^%  on  stock  of  United  Cigar  Mfrs.  Co. 

July  i,  191  i 

The  executors  receive  the  following  checks :  Quarterly 
dividend  of  i^%  on  stock  of  Interurban  R.  R.  Co.  The  semi- 
annual interest  on  the  bond  of  W.  Price  is  defaulted. 

July  3,  191 1 

Improvements  on  the  Henry  Street  property  are  made,  at 
a  cost  of  $1,000.00,  voucher  No.  2y,  James  Cron.  The  West 
Side  Savings  Bank  credits  interest  on  deposit  at  4%,  for  six 
months  ending  June  30. 

July  7,  191 1 
Paid  to  widow  on  account  of  income,  $1,000.00. 

July  15,  191 1 

The  Skyrocket  National  Bank  pays  a  final  liquidation  divi- 
dend of  $550.00.  The  executors  deposit  $18,000.00  on  account 
of  the  inheritance  tax. 

8 


Fiduciary  Accounting 

The  student  should  note  carefully  the  following  important 
provisions  of  the  Tax  Law : 

THE    TAX    LAW 
ARTICLE  X 

TAXABLE     TRANSFERS 

Sect.  220.  TAXABLE  TRANSFERS.  A  tax  shall  be  and  is 
hereby  imposed  upon  the  transfer  of  any  tangible  property  within 
the  state  and  of  intangible  property,  or  of  any  interest  therein  or 
income  therefrom,  in  trust  or  otherwise,  to  persons  or  corporations  in 
the  following  cases,  subject  to  the  exemptions  and  limitations  herein- 
after prescribed: 

1.  When  the  transfer  is  by  will  or  by  the  intestate  laws  of  this 
state  of  any  intangible  property,  or  of  tangible  property  within  the 
state,  from  any  person  dying  seized  or  possessed  thereof  while  a  resident 
of   the   state. 

2.  When  the  transfer  is  by  will  or  intestate  law,  of  tangible 
property  within  the  state,  and  the  decedent  was  a  non-resident  of 
the  state  at  the  time  of  his  death. 

3.  Whenever  the  property  of  a  resident  decedent,  or  the  property 
of  a  non-resident  decedent  within  this  state,  transferred  by  will,  is 
not  specifically  bequeathed  or  devised,  such  property  shall,  for  the 
purposes  of  this  article,  be  deemed  to  be  transferred  proportionately 
to  and  divided  pro  rata  among  all  the  general  legatees  and  devisees 
named  in  said  decedent's  will,  including  all  transfers  under  a  residuary 
clause  of  such  will. 

4.  When  the  transfer  is  of  intangible  property,  or  of  tangible 
property  within  the  state,  made  by  a  resident,  or  of  tangible  property 
within  the  state  made  by  a  non-resident,  by  deed,  grant,  bargain,  sale 
or  gift  made  in  contemplation  of  the  death  of  the  grantor,  vendor  or 
donor,  or  intended  to  take  effect  in  possession  or  enjoyment  at  or  after 
such    death. 

5.  When  any  such  person  or  corporation  becomes  beneficially 
entitled,  in  possession  or  expectancy,  to  any  property  or  the  income 
thereof  by  any  such  transfer,  whether  made  before  or  after  the  passage 
of  this  chapter. 

6.  Whenever  any  person  or  corporation  shall  exercise  a  power 
of  appointment  derived  from  any  disposition  of  property  made  either 
before  or  after  the  passage  of  this  chapter,  such  appointment  when 
made  shall  be  deemed  a  transfer  taxable  under  the  provisions  of 
this  chapter,  in  the  same  manner  as  though  the  property  to  which 
such  appointment  relates  belonged  absolutely  to  the  donee  of  such 
power  and  had  been  bequeathed  or  devised  by  such  donee  by  will. 

7.  The  tax  imposed  hereby  shall  be  upon  the  clear  market  value 
of  such  property,  at  the  rates  hereinafter  prescribed. 

Sect.  221.     EXCEPTIONS  AND  LIMITATIONS.     Any  prop- 


Fiduciary  Accounting 

erty  devised  or  bequeathed  for  religious  ceremonies,  observances,  or 
commemorative  services  of  or  for  the  deceased  donor,  or  to  any  person 
who  is  a  bishop,  or  to  any  religious,  educational,  charitable,  mission- 
ary, benevolent,  hospital  or  infirmary  corporation,  wherever  incor- 
porated, including  corporations  organized  exclusively  for  bible  or 
tract  purposes  and  corporations  organized  for  the  enforcement  of  laws 
relating  to  children  or  animals,  shall  be  exempted  from  and  not 
subject  to  the  provisions  of  this  article.  There  shall  also  be  exempted 
from  and  not  subject  to  the  provisions  of  this  article  bonds  or  other 
obligations  issued  by  the  State  of  New  York,  provided,  however,  that 
such  bonds  or  other  obligations  are  registered  in  the  name  of  the 
decedent  at  the  time  of  death,  or  in  the  name  of  one  or  more  persons 
or  corporations  in  trust  for  such  decedent  at  the  time  of  such  dece- 
dent's death.  There  shall  also  be  exempted  from  and  not  subject  to 
the  provisions  of  this  article  personal  property  other  than  money 
or  securities  bequeathed  to  a  corporation  or  association,  wherever 
incorporated  or  located,  organized  exclusively  for  the  moral  or  mental 
improvement  of  men  or  women  or  for  scientific,  literary,  library, 
patriotic,  cemetery  or  historical  purposes,  or  for  two  or  more  of  such 
purposes,  and  used  exclusively  for  carrying  out  one  or  more  of  such 
purposes.  But  no  such  corporation  or  association  shall  be  entitled 
to  such  exemption  if  any  officer,  member  or  employee  thereof  shall 
receive,  or  may  be  lawfully  entitled  to  receive,  any  pecuniary  profit 
from  the  operations  thereof,  except  reasonable  compensation  for 
services  in  effecting  one  or  more  of  such  purposes  or  as  proper  bene- 
ficiaries of  its  strictly  charitable  purposes;  or  if  the  organization 
thereof  for  any  such  avowed  purpose  be  a  guise  or  pretense  for  directly 
or  indirectly  making  any  other  pecuniary  profit  for  such  corporation 
or  association  or  for  any  of  its  members  or  employees,  or  if  it  be 
not  in  good  faith  organized  or  conducted  exclusively  for  one  or  more 
of  such  purposes. 

Sect.  221a.  RATES  OF  TAX.  i.  Upon  a  transfer  taxable  under 
this  article  of  property  or  any  beneficial  interest  therein,  of  an  amount 
in  excess  of  the  value  of  five  thousand  dollars  to  any  father,  mother, 
husband,  wife,  child,  brother,  sister,  wife  or  widow  of  a  son,  or  the 
husband  of  a  daughter,  or  any  child  or  children  adopted  as  such  in 
conformity  with  the  laws  of  this  state,  of  the  decedent,  grantor,  donor, 
or  vendor,  or  to  any  child  to  whom  any  such  decedent,  grantor,  donor, 
or  vendor,  for  not  less  than  ten  years  prior  to  such  transfer,  stood  in 
the  mutually  acknowledged  relation  of  a  parent,  provided,  however, 
such  relationship  began  at  or  before  the  child's  fifteenth  birthday,  and 
was  continuous  for  said  ten  years  thereafter,  or  to  any  lineal  descendant 
of  such  decedent,  grantor,  donor,  or  vendor,  born  in  lawful  wedlock, 
the  tax  on  such  transfer  shall  be  at  the  rate  of — 

One  per  centum  on  any  amount  in  excess  of  five  thousand  dollars 
up  to  the  sum  of  fifty  thousand  dollars. 

Two  per  centum  on  any  amount  in  excess  of  fifty  thousand  dollars 
up  to  the  sum  of  two  hundred  and  fifty  thousand  dollars. 

10 


Fiduciary  Accounting 

Three  per  centum  on  any  amount  in  excess  of  two  hundred  and 
fifty  thousand  dollars  up  to  the  sum  of  one  million  dollars. 

Four  per  centum  on  any  amount  in  excess  of  one  million  dollars. 

2.  Upon  a  transfer  taxable  under  this  article,  of  property  or  any 
beneficial  interest  therein,  of  an  amount  in  excess  of  the  value  of 
one  thousand  dollars  to  any  person  or  corporation  other  than  those 
enumerated  in  paragraph  i  of  this  section,  the  tax  shall  be  at  the 
rate  of — 

Five  per  centum  on  any  amount  in  excess  of  one  thousand  dollars 
up  to  the  sum  of  fifty  thousand  dollars. 

Six  per  centum  on  any  amount  in  excess  of  fifty  thousand  dollars 
up  to  the  sum  of  two  hundred  and  fifty  thousand  dollars. 

Seven  per  centum  on  any  amount  in  excess  of  two  hundred  and 
fifty  thousand  dollars  up  to  the  sum  of  one  million  dollars. 

Eight  per  centum  on  any  amount  in  excess  of  one  million  dollars. 

Sect.  221b.  EXEMPTION  OF  CERTAIN  PERSONAL  PROP- 
ERTY. A  transfer  of  pictures,  statuary,  works  of  art,  antiques,  books, 
manuscripts,  or  other  similar  personal  property,  shall  be  exempted  from 
and  not  subject  to  the  provisions  of  this  article,  if  within  two  years 
after  such  transfer  the  person  to  whom  such  transfer  is  made  shall 
present  the  same  to  the  state,  or  to  a  municipal  corporation  of  the 
state  for  educational,  scientific,  literary,  library,  or  historical  purposes; 
and  if  the  tax  thereon  shall  have  been  theretofore  paid  the  amount 
thereof  shall  be  refunded  in  accordance  with  the  provisions  of  this 
article. 

Sect.  222.  ACCRUAL  AND  PAYMENT  OF  TAX.  All  taxes 
imposed  by  this  article  shall  be  due  and  payable  at  the  time  of  the 
transfer,  except  as  herein  otherwise  provided.  Taxes  upon  the  transfer 
of  any  estate,  property  or  interest  therein  limited,  conditioned,  dependent 
or  determinable  upon  the  happening  of  any  contingency  or  future  event 
by  reason  of  which  the  fair  market  value  thereof  cannot  be  ascertained 
at  the  time  of  the  transfer,  as  herein  provided,  shall  accrue  and  become 
due  and  payable  when  the  persons  or  corporations  beneficially  entitled 
thereto  shall  come  into  actual  possession  or  enjoyment  thereof.  Such 
tax  shall  be  paid  to  the  state  comptroller  in  a  county  in  which  the 
office  of  appraiser  is  salaried,  and  in  other  counties,  to  the  county  treas- 
urer, and  said  state  comptroller  or  county  treasurer  shall  give,  and 
every  executor,  administrator  or  trustee  shall  take,  duplicate  receipts 
from  him  of  such  payment,  as  provided  in  section  two  hundred  and 
thirty-six. 

Sect.  223.  DISCOUNT  AND  INTEREST.  If  such  tax  is  paid 
within  six  months  from  the  accrual  thereof,  a  discount  of  five  per 
centum  shall  be  allowed  and  deducted  therefrom.  If  such  tax  is  not 
paid  within  eighteen  months  from  the  accrual  thereof,  interest  shall 
be  charged  and  collected  thereon  at  the  rate  of  ten  per  centum  per 
annum  from  the  time  the  tax  accrued;  unless  by  reason  of  claims 
made  upon  the  estate,  necessary  litigation  or  other  unavoidable  cause 
of  delay,  sucR  tax  cannot  be  determined  and  paid  as  herein  provided, 

II 


Fiduciary  Accounting 

in  which  case  interest  at  the  rate  of  six  per  centum  per  annum  shall 
be  charged  upon  such  tax  from  the  accrual  thereof  until  the  cause 
of  such  delay  is  removed,  after  which  ten  per  centum  shall  be  charged. 

Sect.  224.  UEN  OF  TAX  AND  COLLECTION  BY  EXECU- 
TORS, ADMINISTRATORS  AND  TRUSTEES.  Every  such  tax 
shall  be  and  remain  a  lien  upon  the  property  transferred  until  paid 
and  the  person  to  whom  the  property  is  so  transferred,  and  the  execu- 
tors, administrators  and  trustees  of  every  estate  so  transferred  shall 
be  personally  liable  for  such  tax  until  its  payment.  Every  executor, 
administrator  or  trustee  shall  have  full  power  to  sell  so  much  of  the 
property  of  the  decedent  as  will  enable  him  to  pay  such  tax  in  the 
same  manner  as  he  might  be  entitled  by  law  to  do  for  the  payment  of 
the  debts  of  the  testator  or  intestate.  Any  such  executor,  administrator 
or  trustee  having  in  charge  or  in  trust  any  legacy  or  property  for 
distribution,  subject  to  such  tax,  shall  deduct  the  tax  therefrom  and 
shall  pay  over  the  same  to  the  state  comptroller  or  county  treasurer, 
as  herein  provided.  If  such  legacy  or  property  be  not  in  money,  he 
shall  collect  the  tax  thereon  upon  the  appraised  value  thereof  from 
the  person  entitled  thereto.  He  shall  not  deliver  or  be  compelled  to 
deliver  any  specific  legacy  or  property  subject  to  tax  under  this  article 
to  any  person  until  he  shall  have  collected  the  tax  thereon.  If  any 
such  legacy  shall  be  charged  upon  or  payable  out  of  real  property,  the 
heir  or  devisee  shall  deduct  such  tax  therefrom  and  pay  it  to  the 
executor,  administrator  or  trustee,  and  the  tax  shall  remain  a  lien 
or  charge  on  such  real  property  until  paid;  and  the  payment  thereof 
shall  be  enforced  by  the  executor,  administrator  or  trustee  in  the  same 
manner  that  payment  of  the  legacy  might  be  enforced,  or  by  the 
district  attorney  under  section  two  hundred  and  thirty-five  of  this 
chapter.  If  any  such  legacy  shall  be  given  in  money  to  any  such 
person  for  a  limited  period,  the  executor,  administrator  or  trustee 
shall  retain  the  tax  upon  the  whole  amount;  but  if  it  be  not  in  money, 
he  shall  make  application  to  the  court  having  jurisdiction  of  any 
accounting  by  him,  to  make  an  apportionment,  if  the  case  require  it, 
of  the  sum  to  be  paid  into  his  hands  by  such  legatees,  and  for  such 
further  order  relative  thereto  as  the  case  may  require. 

Sect.  225.  REFUND  OF  TAX  ERRONEOUSLY  PAID.  If  any 
debts  shall  be  proven  against  the  estate  of  a  decedent  after  the  payment 
of  any  legacy  or  distributive  share  thereof,  from  which  any  such  tax 
has  been  deducted  or  upon  which  it  has  been  paid  by  the  person 
entitled  to  such  legacy  or  distributive  share,  and  such  person  is  required 
by  order  of  the  surrogate  having  jurisdiction,  on  notice  to  the  state 
comptroller,  to  refund  the  amount  of  such  debts  or  any  part  thereof, 
an  equitable  proportion  of  the  tax  shall  be  repaid  to  him  by  the 
executor,  administrator  or  trustee,  if  the  tax  has  not  been  paid  to 
the  state  comptroller  or  county  treasurer;  or  if  such  tax  has  been 
paid  to  such  state  comptroller  or  county  treasurer,  such  officer  shall 
refund  out  of  the  funds  in  his  hands  or  custody  to  the  credit  of  such 
taxes  such  equitable  proportion  of  the  tax,  and  credit  himself  with 

12 


Fiduciary  Accounting 

the  same  in  the  account  required  to  be  rendered  by  him  under  this 
article.  If  after  the  payment  of  any  tax  in  pursuance  of  an  order 
fixing  such  tax,  made  by  the  surrogate  having  jurisdiction,  such  order 
be  modified  or  reversed  by  the  surrogate  having  jurisdiction  within 
two  years  from  and  after  the  date  of  entry  of  the  order  fixing  the 
tax,  or  be  modified  or  reversed  at  any  time  on  an  appeal  taken 
therefrom  within  the  time  allowed  by  law  on  due  notice  to  the  state 
comptroller,  the  state  comptroller  shall,  if  such  tax  was  paid  in  a 
county  in  which  the  office  of  appraiser  is  salaried,  refund  to  the 
executor,  administrator,  trustee,  person  or  persons  by  whom  such 
tax  was  paid,  the  amount  of  any  moneys  paid  or  deposited  on  account 
of  such  tax  in  excess  of  the  amount  of  the  tax  fixed  by  the  order 
modified  or  reversed,  out  of  the  funds  in  his  hands  or  custody  to  the 
credit  of  such  taxes,  and  to  credit  himself  with  the  same  in  the 
account  required  to  be  rendered  by  him  under  this  article;  or  if  paid 
in  a  county  in  which  the  office  of  appraiser  is  not  salaried,  he  shall 
by  warrant  direct  and  allow  the  county  treasurer  of  the  county  to 
refund  such  amount  in  the  same  manner;  but  no  application  for  such 
refund  shall  be  made  after  one  year  from  such  reversal  or  modification, 
unless  an  appeal  shall  be  taken  therefrom,  in  which  case  no  such 
application  shall  be  made  after  one  year  from  the  final  determination 
on  such  appeal,  or  of  an  appeal  taken  therefrom,  and  the  representatives 
of  the  estate,  legatees,  devisees  or  distributees  entitled  to  any  refund 
under  this  section  shall  not  be  entitled  to  any  interest  upon  such 
refund,  and  the  state  comptroller  shall  deduct  from  the  fees  allowed 
by  this  article  to  the  county  treasurer  the  amount  theretofore  allowed 
him  upon  such  overpayment.  Where  it  shall  be  proved  to  the  satis- 
faction of  the  surrogate  that  deductions  for  debts  were  allowed  upon 
the  appraisal,  since  proved  to  have  been  erroneously  allowed,  it  shall 
be  lawful  for  such  surrogate  to  enter  an  order  assessing  the  tax 
upon  the  amount  wrongfully  or  erroneously  deducted.  This  section, 
as  amended,  shall  apply  to  appeals  and  proceedings  now  pending  and 
taxes  heretofore  paid  in  relation  to  which  the  period  of  one  year 
from  such  reversal  or  modification  has  not  expired  when  this  section, 
as  amended,  takes  effect. 

Sect.  226.  TAXES  UPON  DEVISES  AND  BEQUESTS  IN 
LIEU  OF  COMMISSIONS.  If  a  testator  bequeaths  or  devises 
property  to  one  or  more  executors  or  trustees  in  lieu  of  their  commis- 
sions or  allowances,  or  makes  them  his  legatees  to  an  amount  exceed- 
ing the  commissions  or  allowances  prescribed  by  law  for  an  executor 
or  trustee,  the  excess  in  value  of  the  property  so  bequeathed  or  devised 
above  the  amount  of  commissions  or  allowances  prescribed  by  law  in 
similar  cases  shall  be  taxable  under  this  article. 

Sect.  227.  LIABIUTY  OF  CERTAIN  CORPORATIONS  TO 
TAX.  If  a  foreign  executor,  administrator  or  trustee  shall  assign 
or  transfer  any  stock  or  obligations  in  this  state  standing  in  the  name 
of  a  decedent,  or  in  trust  for  a  decedent,  liable  to  any  such  tax,  the 
tax  shall  be  paid  to  the  state  comptroller  or  the  treasurer  of  the  proper 

13 


Fiduciary  Accounting 

county  on  the  transfer  thereof.  No  safe  deposit  company,  trust  com- 
pany, corporation,  bank  or  other  institution,  person  or  persons  having 
in  possession  or  under  control  securities,  deposits,  or  other  assets 
belonging  to  or  standing  in  the  name  of  decedent  who  was  a  resident 
or  non-resident,  or  belonging  to,  or  standing  in  the  joint  names  of 
such  decedent  and  one  or  more  persons,  including  the  shares  of  the 
capital  stock  of,  or  other  interests  in,  the  safe  deposit  company,  trust 
company,  corporation,  bank  or  other  institution  making  the  delivery 
or  transfer  herein  provided,  shall  deliver  or  transfer  the  same  to  the 
executors,  administrators  or  legal  representatives  of  said  decedent, 
or  to  the  survivor  or  survivors  when  held  in  the  joint  names  of  a 
decedent  and  one  or  more  persons,  or  upon  their  order  or  request, 
unless  notice  of  the  time  and  place  of  such  intended  delivery  or  transfer 
be  served  upon  the  state  comptroller  at  least  ten  days  prior  to  said 
delivery  or  transfer;  nor  shall  any  such  safe  deposit  company,  trust 
company,  corporation,  bank  or  other  institution,  person  or  persons, 
deliver  or  transfer  any  securities,  deposits  or  other  assets  belonging 
to,  or  standing  in  the  name  of  a  decedent,  or  belong  to,  or  stand- 
ing in  the  joint  names  of  a  decedent  and  one  or  more  persons, 
including  the  shares  of  the  capital  stock  of,  or  other  interests 
in,  the  safe  deposit  company,  trust  company,  corporation,  bank  or 
other  institution  making  the  delivery  or  transfer,  without  retaining 
a  sufficient  portion  or  amount  thereof  to  pay  any  tax  and  interest 
which  may  thereafter  be  assessed  on  account  of  the  delivery  or  transfer 
of  such  securities,  deposits  or  other  assets,  including  the  shares  of 
the  capital  stock  of,  or  other  interests  in,  the  safe  deposit  company,  trust 
company,  corporation,  bank  or  other  institution  making  the  delivery 
or  transfer,  under  the  provisions  of  this  article,  unless  the  state  comp- 
troller consents  thereto  in  writing.  And  it  shall  be  lawful  for  the 
said  state  comptroller,  personally  or  by  representative,  to  examine 
said  securities,  deposits  or  assets  at  the  time  of  such  delivery  or 
transfer.  Failure  to  serve  such  notice,  or  failure  to  allow  such  exam- 
ination, or  failure  to  retain  a  sufficient  portion  or  amount  to  pay 
such  tax  and  interest,  as  herein  provided,  shall  render  said  safe 
deposit  company,  trust  company,  corporation,  bank  or  other  institution, 
person  or  persons  liable  to  the  payment  of  the  amount  of  the  tax 
and  interest  due  or  thereafter  to  become  due  upon  said  securities, 
deposits  or  other  assets,  including  the  shares  of  the  capital  stock  of, 
or  other  interests  in,  the  safe  deposit  company,  trust  company,  cor- 
poration, bank  or  other  institution  making  the  delivery  or  transfer, 
and  in  addition  thereto,  a  penalty  of  not  less  than  five  or  more  than 
twenty-five  thousand  dollars ;  and  the  payment  of  such  tax  and  interest 
thereon,  or  of  the  penalty  above  prescribed,  or  both,  may  be  enforced 
in  an  action  brought  by  the  state  comptroller  in  any  court  of  competent 
jurisdiction. 

Sect.  228.  JURISDICTION  OF  THE  SURROGATE.  The  surro- 
gate's court  of  every  county  of  the  state  having  jurisdiction  to  grant 
letters  testamentary  or  of  administration  upon  the  estate  of  a  decedent 

14 


Fidu ciary  Accoun ting 

whose  property  is  chargeable  with  any  tax  under  this  article,  or  to 
appoint  a  trustee  of  such  estate  or  any  part  thereof,  or  to  give  ancillary 
letters  thereon,  shall  have  jurisdiction  to  hear  and  determine  all  ques- 
tions arising  under  the  provisions  of  this  article,  and  to  do  any  act 
in  relation  thereto  authorized  by  law  to  be  done  by  a  surrogate  in 
other  matters  or  proceedings  coming  within  his  jurisdiction;  and  if 
two  or  more  surrogates'  courts  shall  be  entitled  to  exercise  any  such 
jurisdiction,  the  surrogate  first  acquiring  jurisdiction  hereunder  shall 
retain  the  same  to  the  exclusion  of  every  other  surrogate.  Every 
petition  for  ancillary  letters  testamentary  or  ancillary  letters  of  admin- 
istration made  in  pursuance  of  the  provisions  of  article  seven,  title 
three,  chapter  eighteen,  of  the  code  of  civil  procedure,  shall  set  forth 
the  name  of  the  state  comptroller  as  a  person  to  be  cited  as  therein 
prescribed,  and  a  true  and  correct  statement  of  all  the  decedent's 
property  in  this  state  and  the  value  thereof;  and  upon  the  presentation 
thereof  the  surrogate  shall  issue  a  citation  directed  to  the  state  comp- 
troller ;  and  upon  the  return  of  the  citation  the  surrogate  shall  determine 
the  amount  of  the  tax  which  may  be  or  become  due  under  the  pro- 
visions of  this  article,  and  his  decree  awarding  the  letters  may  contain 
any  provision  for  the  payment  of  such  tax,  or  the  giving  of  security 
therefor,  which  might  be  made  by  such  surrogate  if  the  state  comptroller 
were  a  creditor  of  the  decedent. 

Sect.  230.  PROCEEDINGS  OF  APPRAISER.  In  each  county 
in  which  the  office  of  appraiser  is  not  salaried  the  county  treasurer 
shall  act  as  appraiser.  The  surrogate,  either  upon  his  own  motion,  or 
upon  the  application  of  any  interested  person,  including  the  state 
comptroller,  shall  by  order  direct  the  person  or  one  of  the  persons 
appointed  pursuant  to  section  two  hundred  and  twenty-nine  of  this 
article  in  counties  in  which  the  office  of  appraiser  is  salaried,  and  in 
other  counties,  the  county  treasurer,  to  fix  the  fair  market  value  of 
property  of  persons  whose  estates  shall  be  subject  to  the  payment 
of  any  tax  imposed  by  this  article. 

Every  such  appraiser  shall  forthwith  give  notice  by  mail  to  all 
persons  known  to  have  a  claim  or  interest  in  the  property  to  be 
appraised,  including  the  state  comptroller,  and  to  such  persons  as 
the  surrogate  may  by  order  direct,  of  the  time  and  place  when  he 
will  appraise  such  property.  He  shall  at  such  time  and  place  appraise 
the  same  at  its  fair  market  value  as  herein  prescribed;  and  for  that 
purpose  the  said  appraiser  is  authorized  to  issue  subpoenas  and  to 
compel  the  attendance  of  witnesses  before  him,  and  to  take  the  evidence 
of  such  witnesses,  under  oath,  concerning  such  property  and  the  value 
thereof;  and  he  shall  make  report  thereof  and  of  such  value,  in  writing, 
to  the  said  surrogate,  together  with  the  depositions  of  the  witnesses 
examined,  and  such  other  facts  in  relation  thereto  and  to  said  matter 
as  the  surrogate  may  order  or  require.  Every  appraiser,  except  in 
the  counties  in  which  the  office  of  appraiser  is  salaried,  for  which 
provision  is  hereinbefore  made,  shall  be  paid  by  the  state  comptroller, 
and  after  the  audit  of  said  state  comptroller,  his  actual  and  necessary 

15 


Fiduciary  Accounting 

traveling  expenses  and  the  fees  paid  such  witnesses,  which  fees  shall 
be  the  same  as  those  now  paid  to  witnesses  subpoenaed  to  attend  in 
courts  of  record,  payment  to  be  made  out  of  funds  in  the  hands  of 
the  county  treasurer  of  the  proper  county  on  account  of  the  tax  imposed 
under  the  provisions  of  this  article. 

The  value  of  every  future  or  limited  estate,  income,  interest  or 
annuity  dependent  upon  any  life  or  lives  in  being,  shall  be  determined 
by  the  rule,  method  and  standard  of  mortality  and  value  employed 
by  the  superintendent  of  insurance  in  ascertaining  the  value  of  policies 
of  life  insurance  and  annuities  for  the  determination  of  liabilities  of 
life  insurance  companies,  except  that  the  rate  of  interest  for  making 
such  computation  shall  be  five  per  centum  per  annum. 

In  estimating  the  value  of  any  estate  or  interest  in  property,  to  the 
beneficial  enjoyment  or  possession  whereof  there  are  persons  or  corpo- 
rations presently  entitled  thereto,  no  allowance  shall  be  made  on 
account  of  any  contingent  incumbrance  thereon,  nor  on  account  of  any 
contingency  upon  the  happening  of  which  the  estate  or  property,  or 
some  part  thereof  or  interest  therein,  might  be  abridged,  defeated 
or  diminished ;  provided,  however,  that  in  the  event  of  such  incum- 
brance taking  effect  as  an  actual  burden  upon  the  interest  of  the 
beneficiary,  or  in  the  event  of  the  abridgement,  defeat  or  diminution 
of  said  estate  or  property  or  interest  therein  as  aforesaid,  a  return 
shall  be  made  to  the  person  properly  entitled  thereto  of  a  proportionate 
amount  of  such  tax  on  account  of  the  incumbrance  when  taking 
effect,  or  so  much  as  will  reduce  the  same  to  the  amount  which  would 
have  been  assessed  on  account  of  the  actual  duration  or  extent  of 
the  estate  or  interest  enjoyed.  Such  return  of  tax  shall  be  made  in 
the  manner  provided  by  section  two  hundred  and  twenty-five  of  this 
article. 

Where  any  property  shall,  after  the  passage  of  this  chapter,  be  trans- 
ferred subject  to  any  charge,  estate  or  interest,  determinable  by  the 
death  of  any  person,  or  at  any  period  ascertainable  only  by  reference 
to  death,  the  increase  accruing  to  any  person  or  corporation  upon 
the  extinction  or  determination  of  such  charge,  estate  or  interest,  shall 
be  deemed  a  transfer  of  property  taxable  under  the  provisions  of 
this  article  in  the  same  manner  as  though  the  person  or  corporation 
beneficially  entitled  thereto  had  then  acquired  such  increase  from  the 
person  from  whom  the  title  to  their  respective  estates  or  interests  is 
derived. 

When  property  is  transferred  in  trust  or  otherwise,  and  the  rights, 
interest  or  estates  of  the  transferees  are  dependent  upon  contingencies 
or  conditions  whereby  they  may  be  wholly  or  in  part  created,  defeated, 
extended  or  abridged,  a  tax  shall  be  imposed  upon  said  transfer  at 
the  highest  rate  which,  on  the  happening  of  any  of  the  said  contingen- 
cies or  conditions,  would  be  possible  under  the  provisions  of  this 
article,  and  such  tax  so  imposed  shall  be  due  and  payable  forthwith 
by  the  executors  or  trustees  out  of  the  property  transferred,  and  the 
surrogate   shall   enter  a  temporary  order   determining  the  amount  of 

i6 


Fiduciary  Accounting 

said  tax  in  accordance  with  this  provision;  provided,  however,  that 
on  the  happening  of  any  contingency  whereby  the  said  property,  or  any 
part  thereof,  is  transferred  to  a  person  or  corporation  exempt  from 
taxation  under  the  provisions  of  this  article,  or  to  any  person  taxable 
at  a  rate  less  than  the  rate  imposed  and  paid,  such  person  or  corpo- 
ration shall  be  entitled  to  a  return  of  so  much  of  the  tax  imposed 
and  paid  as  is  the  difference  between  the  amount  paid  and  the  amount 
which  said  person  or  corporation  should  pay  under  the  provisions  of 
this  article ;  and  the  executor  or  trustee  of  each  estate,  or  the  legal 
representative  having  charge  of  the  trust  fund,  shall  immediately  upon 
the  happening  of  said  contingencies  or  conditions  apply  to  the  surro- 
gate of  the  proper  county,  upon  a  verified  petition  setting  forth  all  the 
facts,  and  giving  at  least  ten  days'  notice  by  mail  to  all  interested 
persons  or  corporations,  for  an  order  modifying  the  temporary  taxing 
order  of  said  surrogate  so  as  to  provide  for  the  final  assessment  and 
determination  of  the  tax  in  accordance  with  the  ultimate  transfer 
or  devolution  of  said  property.  Such  return  of  overpayment  shall  be 
made  in  the  manner  provided  by  section  two  hundred  and  twenty-five 
of  this  article. 

Estates  in  expectancy  which  are  contingent  or  defeasible,  and  in 
which  proceedings  for  the  determination  of  the  tax  have  not  been 
taken,  or  where  the  taxation  thereof  has  been  held  in  abeyance,  shall 
be  appraised  at  their  full,  undiminished  value  when  the  persons  enti- 
tled thereto  shall  come  into  the  beneficial  enjoyment  or  possession 
thereof,  without  diminution  for  or  on  account  of  any  valuation  there- 
tofore made  of  the  particular  estates  for  purposes  of  taxation,  upon 
which  said  estates  in  expectancy  may  have  been  limited. 

Where  an  estate  for  life  or  for  years  can  be  divested  by  the  act  or 
omission  of  the  legatee  or  devisee  it  shall  be  taxed  as  if  there  were 
no  possibility  of  such  divesting. 

The  report  of  the  appraiser  shall  be  made  in  duplicate,  one  of 
which  duplicates  shall  be  filed  in  the  office  of  the  surrogate  and  the 
other  in  the  office  of  the  state  comptroller. 

Sect.  231.  DETERMINATION  OF  SURROGATE.  From  such 
report  of  appraisal  and  other  proof  relating  to  any  such  estate  before 
the  surrogate,  the  surrogate  shall  forthwith,  as  of  course,  determine 
the  cash  value  of  ail  estates  and  the  amount  of  tax  to  which  the  same  are 
liable ;  or  the  surrogate  may  so  determine  the  cash  value  of  all  such 
estates  and  the  amount  of  tax  to  which  the  same  are  liable,  without 
appointing  an   appraiser. 

The  superintendent  of  insurance  shall,  on  the  application  of  any 
surrogate,  determine  the  value  of  any  such  future  or  contingent  estates, 
income  or  interest  therein  limited,  contingent,  dependent  or  determin- 
able upon  the  life  or  lives  of  persons  in  being,  upon  the  facts  contained 
in  any  such  appraiser's  report,  and  certify  the  same  to  the  surrogate, 
and  his  certificate  shall  be  conclusive  evidence  that  the  method  of 
computation   adopted   therein   is  correct. 

The  surrogate  shall  immediately  give  notice,  upon  the  determination 

17 


Fiduciary  Accounting 

by  him  as  to  the  value  of  any  estate  which  is  taxable  under  this 
article,  and  of  the  tax  to  which  it  is  liable,  to  all  persons  known  to 
be  interested  therein,  and  shall  immediately  forward  a  copy  of  such 
taxing  order  to  the  state  comptroller.  The  surrogate  shall  also  forward 
to  the  state  comptroller  copies  of  all  orders  entered  by  him  in  relation 
to  or  affecting  in  any  way  the  transfer  tax  on  any  estate,  including 
orders   of   exemption. 

If,  however,  it  appear  at  any  stage  of  the  proceedings  that  any 
of  such  persons  known  to  be  interested  in  the  estate  is  an  infant  or 
an  incompetent,  the  surrogate  may,  if  the  interest  of  such  infant  or 
incompetent  is  presently  involved,  and  is  adverse  to  that  of  any  of  the 
other  persons  interested  therein,  appoint  a  special  guardian  of  such 
infant;  but  nothing  in  this  provision  shall  affect  the  right  of  an  infant 
over  fourteen  years  of  age,  or  of  any  one  on  behalf  of  an  infant  under 
fourteen  years  of  age,  to  nominate  and  apply  for  the  appointment  of 
a  special  guardian  for  such  infant  at  any  stage  of  the  proceedings. 

Sect.  232.  APPEAL  AND  OTHER  PROCEEDINGS.  The  state 
comptroller,  or  any  person  dissatisfied  with  the  appraisement  or  assess- 
ment and  determination  of  tax  may  appeal  therefrom  to  the  surrogate 
within  sixty  days  from  the  fixing,  assessing  and  determination  of  tax 
by  the  surrogate,  as  herein  provided,  upon  filing  in  the  office  of  the 
surrogate  a  written  notice  of  appeal,  which  shall  state  the  grounds 
upon  which  the  appeal  is  taken;  but  no  costs  shall  be  allowed  by  the 
surrogate  on  such  appeal. 

Within  two  years  after  the  entry  of  an  order  or  decree  of  a 
surrogate  determining  the  value  of  an  estate  and  assessing  the  tax 
thereon,  the  state  comptroller  may,  if  he  believes  that  such  appraisal, 
assessment  or  determination  has  been  fraudulently,  collusively  or 
erroneously  made,  make  application  to  a  justice  of  the  supreme  court 
of  the  judicial  district  embracing  the  surrogate's  court  in  which  the 
order  or  decree  has  been  filed  for  a  reappraisal  thereof.  The  justice 
to  whom  such  application  is  made  may  thereupon  appoint  a  competent 
person  to  reappraise  such  estate.  Such  appraiser  shall  possess  the 
powers  and  be  subject  to  the  duties  of  an  appraiser,  under  section 
two  hundred  and  thirty,  and  shall  receive  compensation  at  the  rate 
of  five  dollars  per  day  for  every  day  actually  and  necessarily  employed 
in  such  appraisal.  Such  compensation  shall  be  payable  by  the  state 
comptroller  or  county  treasurer  out  of  any  funds  he  may  have  on 
account  of  any  tax  imposed  under  the  provisions  of  this  article,  upon 
the  certificate  of  the  justice  appointing  him.  The  report  of  such 
appraiser  shall  be  filed  with  the  justice  by  whom  he  was  appointed, 
and  thereafter  the  same  proceedings  shall  be  taken  and  had  by  and 
before  such  justice  as  are  herein  provided  to  be  taken  and  had  by 
and  before  the  surrogate.  The  determination  and  assessment  of  such 
justice  shall  supersede  the  determination  and  assessment  of  the  surro- 
gate, and  shall  be  filed  by  such  justice  in  the  office  of  the  state  comp- 
troller, and  a  certified  copy  thereof  transmitted  to  the  surrogate's  court 
of  the  proper  county. 

18 


Fiduciary  Accounting 

Sect.  233.  COMPOSITION  OF  TRANSFER  TAX  UPON  CER- 
TAIN ESTATES.  The  state  comptroller,  by  and  with  the  consent 
of  the  attorney-general,  expressed  in  writing,  is  hereby  empowered 
and  authorized  to  enter  into  an  agreement  with  the  trustees  of  any 
estate  in  which  remainders  or  expectant  estates  have  been  of  such  a 
nature,  or  so  disposed  and  circumstanced,  that  the  taxes  therein  are 
held  not  presently  payable,  or  where  the  interests  of  the  legatees 
or  devisees  were  not  ascertainable  under  the  provisions  of  chapter 
four  hundred  and  eighty-three  of  the  laws  of  eighteen  hundred  and 
eighty-five,  chapter  three  hundred  and  ninety-nine  of  the  laws  of 
eighteen  hundred  and  ninety-two,  or  chapter  nine  hundred  and  eight 
of  the  laws  of  eighteen  hundred  and  ninety-six,  and  the  several  acts 
amendatory  thereof  and  supplemental  thereto;  and  to  compound  such 
taxes  upon  such  terms  as  may  be  deemed  equitable  and  expedient;  and 
to  grant  discharge  to  said  trustees  upon  the  payment  of  the  taxes 
provided  for  in  such  composition,  provided,  however,  that  no  such 
composition  shall  be  conclusive  in  favor  of  said  trustees  as  against 
the  interest  of  such  cestuis  que  trust  as  may  possess  either  present 
rights  of  enjoyment  or  fixed,  absolute  or  indefeasible  rights  of  future 
enjoyment,  or  of  such  as  would  possess  such  rights  in  the  event  of 
the  immediate  termination  of  particular  estates,  unless  they  consent 
thereto,  either  personally,  when  competent,  or  by  guardian  or  com- 
mittee. Composition  or  settlement  made  or  effected  under  the  pro- 
visions of  this  section  shall  be  executed  in  triplicate,  and  one  copy  filed 
in  the  office  of  the  state  comptroller,  one  copy  in  the  office  of  the 
surrogate  of  the  county  in  which  the  tax  was  paid,  and  one  copy 
delivered  to  the  executors,  administrators  or  trustees  who  shall  be 
parties  thereto. 

Sect.  241.  REPORT  OF  STATE  COMPTROLLER;  PAYMENT 
OF  TAXES;  REFUNDS  IN  CERTAIN  CASES.  The  state  comp- 
troller shall  deposit  all  taxes  collected  by  him  under  this  article,  except 
as  hereinafter  otherwise  provided,  in  a  responsible  bank,  bankings 
house  or  trust  company  in  the  city  of  Albany,  which  shall  pay  the 
highest  rate  of  interest  to  the  state  for  such  deposit,  to  the  credit  of 
the  state  comptroller  on  account  of  the  transfer  tax.  And  every 
such  bank,  banking  house  or  trust  company  shall  execute  and  file 
in  his  office  an  undertaking  to  the  state,  in  the  sum,  and  with  such 
sureties,  as  are  required  and  approved  by  the  comptroller,  for  the 
safe  keeping  and  prompt  payment  on  legal  demand  therefor  of  all 
such  moneys  held  by  or  on  deposit  in  such  bank,  banking  house  or 
trust  company,  with  interest  thereon  on  daily  balances  at  such  rate 
as  the  comptroller  may  fix.  Every  such  undertaking  shall  have 
indorsed  thereon,  or  annexed  thereto,  the  approval  of  the  attorney- 
general  as  to  its  form.  The  state  comptroller  shall  on  the  first  day 
of  each  month  make  a  verified  return  to  the  state  treasurer  of  all 
taxes  received  by  him  under  this  article,  stating  for  what  estate  and 
by  whom  and  when  paid;  and  shall  credit  himself  with  all  expenditures 
made   since   his   last  previous   return   on   account   of   such   taxes,   for 

19 


Fiduciary  Accounting 

salary,  refunds  or  other  purposes  lawfully  chargeable  thereto.  He 
shall,  on  or  before  the  tenth  day  of  each  month,  pay  to  the  state 
treasurer  the  balance  of  such  taxes  remaining  in  his  hands  at  the 
close  of  business  on  the  last  day  of  the  previous  month,  as  appears 
from  such  returns.  Whenever  the  tax  on  a  contingent  remainder  has 
been  determined  at  the  highest  rate  which  on  the  happening  of  any 
of  said  contingencies  or  conditions  would  be  possible  under  the 
provisions  of  this  article,  the  state  comptroller,  in  the  counties  wherein 
this  tax  is  payable  direct  to  him,  and  in  all  other  counties  the  treas- 
urer of  said  counties,  respectively,  when  such  tax  is  paid  shall  retain 
and  hold  to  the  credit  of  said  estate  so  much  of  the  tax  assessed  upon 
such  contingent  remainders  as  represents  the  difference  between  the 
tax  at  the  highest  rate  and  the  tax  upon  such  remainders  which 
would  be  due  if  the  contingencies  or  conditions  had  happened  at  the 
date  of  the  appraisal  of  said  estate,  and  the  state  comptroller  or  the 
county  treasurer  shall  deposit  the  amount  of  tax  so  retained  in  some 
solvent  trust  company  or  trust  companies  or  savings  banks  in  this 
state,  to  the  credit  of  such  estate,  paying  the  interest  thereon  when 
collected  by  him  to  the  executor  or  trustee  of  said  estate,  to  be  applied 
by  said  executor  or  trustee  as  provided  by  the  decedent's  will.  Upon 
the  happening  of  the  contingencies  or  conditions  whereby  the  remainder 
ultimately  vests  in  possession,  if  the  remainder  then  passes  to  persons 
taxable  at  the  highest  rate,  the  state  comptroller  or  the  county  treas- 
urer shall  turn  over  the  amount  so  retained  by  him  to  the  state  treas- 
urer, as  provided  herein  and  by  section  two  hundred  and  forty  of 
this  article,  or  if  the  remainder  ultimately  vests  in  persons  taxable  at 
a  lower  rate,  or  a  person  or  corporation  exempt  from  taxation  by  the 
provisions  of  this  article,  the  state  comptroller  or  the  County  treasurer 
shall  refund  any  excess  of  tax  so  held  by  him  to  the  executor  or 
trustee  of  the  estate,  to  be  disposed  of  by  said  executor  or  trustee 
as  provided  by  the  decedent's  will.  Executors  or  trustees  of  any 
estate  may  elect  to  assign  to  and  deposit  with  the  state  comptroller  or 
the  county  treasurer  bonds  or  other  securities  of  the  estate  approved 
by  the  state  comptroller,  or  the  county  treasurer,  both  as  to  the  form 
of  the  collateral  and  the  amount  thereof,  for  the  purpose  of  securing 
the  payment  of  the  difference  between  the  tax  on  said  remainder  at 
the  highest  rate  and  the  tax  upon  said  remainder  which  would  be  due 
if  the  contingencies  or  conditions  had  happened  at  the  date  of  the 
appraisal  of  said  estate,  and  cash  for  the  balance  of  said  tax  as 
assessed,  which  said  bonds  or  other  securities  shall  be  held  by  the 
state  comptroller,  or  the  county  treasurer,  to  the  credit  of  said  estate 
until  the  actual  vesting  of  said  remainders,  the  income  therefrom 
when  received  by  the  state  comptroller  or  the  county  treasurer  to  be 
paid  over  to  the  executor  or  trustee  during  the  continuance  of  the 
trust  estates,  and  then  to  be  finally  disposed  of  in  accordance  with 
the  ultimate  transfer  or  devolution  of  said  remainders,  as  hereinbefore 
provided ;  and  it  shall  be  the  duty  of  the  executors  or  trustees  of  such 
estates  to  forthwith  notify  the  state  comptrolkr  of  the  actual  vesting 
of  all  such  contingent  remainders. 

20 


Fiduciary  Accounting 

If  any  executor  or  trustee  shall  have  deposited  with  the  state 
comptroller  or  the  county  treasurer,  cash  or  securities,  or  both  cash 
and  securities,  to  an  amount  in  excess  of  the  sum  necessary  to  pay 
the  transfer  tax  upon  such  contingent  remainders  at  the  highest  rate, 
as  aforesaid,  the  excess  of  tax  so  deposited  shall  be  returned  to  the 
executor  or  trustee,  or  if  any  executor  or  trustee  shall  have  deposited 
with  the  state  comptroller,  or  the  county  treasurer,  cash  or  securities, 
or  both  cash  and  securities,  to  an  amount  less  than  is  sufficient  to 
pay  the  tax  upon  such  contingent  remainders  as  finally  assessed  and 
determined,  the  executor  or  trustee  of  said  estate  shall  forthwith,  upon 
the  entry  of  the  order  determining  the  correct  amount  of  tax  due,  pay 
to  the  state  comptroller,  or  the  county  treasurer,  whichever  is  entitled 
under  the  provisions  of  this  article  to  receive  the  tax,  the  balance  due 
on  account  of  said  tax. 

Sect.  243.  DEFINITIONS.  The  words  "estate"  and  "property," 
as  used  in  this  article,  shall  be  taken  to  mean  the  property,  or  interest 
therein,  passing  or  transferred  to  individual  or  corporate  legatees, 
devisees,  heirs,  next  of  kin,  grantees,  donees  or  vendees,  and  not  as 
the  property  or  interest  therein  of  the  decedent,  grantor,  donor  or 
vendor,  and  shall  include  all  property  or  interest  therein,  whether 
situated  within  or  without  this  state.  The  words  "tangible  property," 
as  used  in  this  article,  shall  be  taken  to  mean  corporeal  property,  such 
as  real  estate  and  goods,  wares  and  merchandise,  and  shall  not  be  taken 
to  mean  money,  deposits  in  bank,  shares  of  stock,  bonds,  notes,  credits, 
or  evidences  of  an  interest  in  property  and  evidences  of  debt.  The 
words  "intangible  property,"  as  used  in  this  article,  shall  be  taken 
to  mean  incorporeal  property,  including  money,  deposits  in  bank,  shares 
of  stock,  bonds,  notes,  credits,  evidences  of  an  interest  in  property  and 
evidences  of  debt.  The  word  "transfer,"  as  used  in  this  article,  shall 
be  taken  to  include  the  passing  of  property  or  any  interest  therein  in 
the  possession  or  enjoyment,  present  or  future,  by  inheritance,  descent, 
devise,  bequest,  grant,  deed,  bargain,  sale  or  gift,  in  the  manner  herein 
prescribed.  The  words  "county  treasurer"  and  "district  attorney,"  as 
used  in  this  article,  shall  be  taken  to  mean  the  treasurer  or  the  district 
attorney  of  the  county  of  the  surrogate  having  jurisdiction,  as  provided 
in  section  two  hundred  and  twenty-eight  of  this  article.  The  words, 
"the  intestate  laws  of  this  state,"  as  used  in  this  article,  shall  be  taken 
to  refer  to  all  transfers  of  property,  or  any  beneficial  interest  therein, 
eflfected  by  the  statute  of  descent  and  distribution  and  the  transfer 
of  any  property,  or  any  beneficial  interest  therein  effected  by  operation 
of  law  upon  the  death  of  a  person  omitting  to  make  a  valid  disposition 
thereof,  including  a  husband's  right  as  tenant  by  the  courtesy  or  the 
right  of  a  husband  to  succeed  to  the  personal  property  of  his  wife 
who  dies  intestate,  leaving  no  descendants  her  surviving. 


21 


Fiduciary  Accounting 

THE    TAX    LAW 
ARTICLE   XII 

STOCK    TRANSFER    TAX    LAW 

Sect.  270.  AMOUNT  OF  TAX.  There  is  hereby  imposed,  and 
shall  immediately  accrue  and  be  collected  a  tax,  as  herein  provided, 
on  all  sales,  or  agreements  to  sell,  or  memoranda  of  sales  of  stock,  and 
upon  any  and  all  deliveries  or  transfers  of  shares  or  certificates  of 
stock,  in  any  domestic  or  foreign  association,  company  or  corporation, 
made  after  the  first  day  of  June,  nineteen  hundred  and  five,  whether 
made  upon  or  shown  by  the  books  of  the  association,  company  or 
corporation,  or  by  any  assignment  in  blank,  or  by  any  delivery,  or 
by  any  paper  or  agreement  or  memorandum,  or  other  evidence  of  sale 
or  transfer,  whether  intermediate  or  final,  and  whether  investing 
the  holder  with  the  beneficial  interest  in  or  legal  title  to  said  stock, 
or  merely  with  the  possession  or  use  thereof  for  any  purpose,  or  to 
secure  the  future  payment  of  money,  or  the  future  transfer  of  any 
stock,  on  each  hundred  dollars  of  face  value  or  fraction  thereof,  two 
cents,  except  in  cases  where  the  shares  or  certificates  of  stock  are 
issued  without  designated  monetary  value,  in  which  cases  the  tax 
shall  be  at  the  rate  of  two  cents  for  each  and  every  share  of  such 
stock.  It  shall  be  the  duty  of  the  person  or  persons  making  or 
effectuating  the  sale  or  transfer  to  procure  and  affix  the  stamps  and 
pay  the  tax  provided  by  this  article.  It  is  not  intended  by  this  act  to 
impose  a  tax  upon  an  agreement  evidencing  the  deposit  of  stock  cer- 
tificates as  collateral  security  for  money  loaned  thereon,  which  stock 
certificates  are  not  actually  sold,  nor  upon  such  stock  certificates  so 
deposited,  nor  upon  mere  loans  of  stock  or  the  return  thereof.  The 
payment  of  such  tax  shall  be  denoted  by  an  adhesive  stamp  or  stamps 
affixed  as  follows:  In  the  case  of  a  sale  or  transfer,  where  the  evi- 
dence of  the  transaction  is  shown  only  by  the  books  of  the  association, 
company  or  corporation,  the  stamp  shall  be  placed  upon  such  books, 
and  it  shall  be  the  duty  of  the  person  making  or  effectuating  such  sale 
or  transfer  to  procure  and  furnish  to  the  association,  company  or 
corporation  the  requisite  stamps,  and  of  such  association,  company  or 
corporation  to  aflftx  and  cancel  the  same.  Where  the  transaction  is 
effected  by  the  delivery  or  transfer  of  a  certificate,  the  stamp  shall 
be  placed  upon  the  surrendered  certificate  and  cancelled;  and  in  cases 
of  an  agreement  to  sell,  or  where  the  sale  is  effected  by  delivery  of 
the  certificate  assigned  in  blank,  there  shall  be  made  and  delivered 
by  the  seller  to  the  buyer  a  bill  or  memorandum  of  such  sale,  to  which 
the  stamp  provided  for  by  this  article  shall  be  affixed  and  cancelled. 
Every  such  bill  or  memorandum  of  sale,  or  agreement  to  sell,  shall 
show  the  date  of  the  transaction  which  it  evidences,  the  name  of 
the  seller,   the   stock  to  which   it   relates,   and  the  number  of   shares 

22 


Fiduciary  Accounting 

thereof.  All  such  bills  or  memoranda  of  sale  shall  bear  a  number 
upon  the  face  thereof,  and  no  more  than  one  such  bill  or  memorandum 
of  sale  made  by  the  seller  on  any  given  day  shall  bear  the  same  num- 
ber. The  aforesaid  identification  number  of  the  bill  or  memorandum 
of  sale  shall  in  all  cases  be  entered  and  recorded  on  the  books  of 
account  required  to  be  kept  by  article  two  hundred  and  seventy-six 
of  this  chapter ;  and  no  further  tax  is  hereby  imposed  upon  the  delivery 
of  the  certificate  of  stock,  or  upon  the  actual  issue  of  a  new  certificate 
when  the  original  certificate  of  stock  is  accompanied  by  the  duly 
stamped  memorandum  of  sale  as  herein  provided. 

EXCERPTS    FROM    RULINGS    OF    STATE   COMPTROLLER'S 

OFFICE   GOVERNING   THE    COLLECTION    OF 

TAXES  ON  TRANSFERS  OF  STOCK 

4.  It  is  not  necessary,  to  render  it  taxable,  that  the  transaction 
involve  a  sale.  By  the  statute,  as  amended,  a  tax  is  imposed  upon  all 
sales  or  transfers  of  shares  or  certificates  of  stock,  whether  operating 
to  convey  the  beneficial  interest  in  or  merely  the  legal  title  to  said 
stock,  or  possession  thereof  for  any  purpose.  The  only  exceptions  to 
this  rule  are  those  expressly  provided  for  in  section  270  of  the  law. 

5.  The  transfer  to  and  from  voting  trustees  is  taxable;  also  the 
transfer  of  voting  trust  certificates. 

6.  The  mere  surrender  of  a  certificate  of  stock  for  reissue  in 
smaller  denomination  is  not  taxable;  but  if  reissued  in  part  to  the 
original  owner  and  in  part  to  a  third  party  it  is  taxable  to  the  extent 
of  the  transfer  to  the  third  party. 

7.  Likewise,  the  mere  surrender  of  a  certificate  of  stock  held  by 
a  deceased  person  for  issuance  in  the  name  of  his  executor  or  admin- 
istrator is  not  taxable;  but  all  transfers  made  by  the  latter,  whether 
to  trustees,  legatees,  or  other  persons,  are  taxable. 

8.  The  law  applies  to  the  stock  of  foreign  as  well  as  domestic 
corporations  and  to  residents  and  non-residents  alike. 

10.  It  is  the  duty  of  the  person  making  or  effectuating  the  sale 
or  transfer  to  pay  the  required  tax  by  procuring,  affixing  and  cancelling 
the  stamps,  except  that  where  a  sale  or  transfer  is  shown  only  by 
the  books  of  the  corporation,  the  person  making  the  sale  must  secure, 
and  the  corporation  affix  the  stamps  to  its  books.     (Sect.  270.) 


August  i,  191  i 

Balance  due  on  contract  to  purchase  realty  is  paid,  voucher 
No.  30. 

Taxes  on  farm  lands  in  Iowa,  assessed  prior  to  testator's 
death,  amounting  to  $84.00,  are  paid.  The  executors  com- 
mence foreclosure  proceedings  against  William  Price. 

23 


Fiduciary  Accounting 


August  3,  191 1 

Notice  received  by  executors  of  credit  for  interest  for  year 
ended  June  30,  191 1,  by  Mechanics  and  Ninth  Ward  Savings 
banks;  amounts,  respectively,  are  $20.48  and  $60.60. 

August  7,  191 1 

Payment  is  made  of  the  following  debts:  voucher  No.  32, 
Goodrun  Tire  Co.,  a  New  York  corporation,  due  on  stock 
subscription  made  by  testator  in  his  lifetime  for  sixteen  shares, 
par  value  $100  each,  $1,600.00;  voucher  No.  33,  Rogers,  Peet 
Co.,  $373.00. 

Legal  fees  in  connection  with  probate  of  will  and  services 
to  date  paid  to  J.  Bennett,  $1,200.  Transfer  tax  appraisers 
appointed. 

September  i,  191  i 

Received  rent  of  Henry  Street  property,  $200.00  Paid 
balance  of  testator's  debts  as  follows :  Fresco  Decorating  Co., 
$395.00;  Heddon  &  Co.,  contractors,  $3,195.00. 

September  7,  191 1 

Executors  pay  the  transfer  tax.  Jane  Smart  is  married 
to  James  Farrand.  The  property  of  W.  Price  is  sold  at  public 
auction  and  realized  $25,000.00.  The  executors  receive  the 
interest  due  on  the  second  mortgage;  also  the  quarterly  divi- 
dend of  i%%  on  the  stock  of  the  United  Cigar  Mfrs.  Co. 

October  2,  191 1 

The  executors  receive  the  quarterly  dividend  on  stock  of 
Interurban  R.  R.  Co.  of  i%% ;  half-yearly  interest  on  bond  of 
James  Kent.  The  executors  invest  in  a  bond  and  mortgage  of 
Charles  H.  Keepler,  premises,  352  West  Forty-third  Street, 
Manhattan,  recorded  in  Section  4.  Liber  193  of  Mortgages, 
page  82,  due  April  i,  1914.  Interest  at  5%,  payable  October 
I  and  April  i,  $50,000.00. 


24 


Fiduciary  Accounting 

November  i,  191  i 

Check  received  for  interest  on  N.  Y.  C.  gold  debentures. 
Paid  taxes  of  current  year  on  realty,  $246.00;  personalty, 
$1,241.60. 

December  i,  191  i 

Executors  receive  rent  of  Henry  Street  property,  $200.00; 
quarterly  dividend  of  Ij4%  on  stock  of  United  Cigar  Mfrs. 
Co. 

December  30,  191 1 

The  Union  Trust  Co.  allowed  a  credit  on  the  balance  of 
the  testator's  account  to  date  of  death,  $14.37;  subsequent  to 
death,  $304.00.  Paid  to  widow  on  account  of  income,  $500.00. 
Close  the  cash  book  and  prepare  a  trial  balance  of  the  ledger 
as  of  December  31,  191 1. 

January  2,  191 2 

Stock  of  Interurban  R.  R.  Co.  sold  for  $117,000.00,  less 
usual  brokerage  and  expense;  this  stock  sells  ex-dividend  on 
January  i.  The  executors  purchase  for  $85,000.00  and 
accrued  interest  a  bond  and  mortgage  of  Charles  R.  Heinz, 
premises  361-363  West  Fifty-eighth  Street,  Manhattan,  re- 
corded in  Section  4,  Liber  220  of  Mbrtgages,  page  82,  due 
March  2,  1916,  interest  5%,  March  i  and  September  i.  The 
executors  withdraw  all  deposits  from  savings  banks,  trans- 
ferring the  respective  deposits  to  the  Union  Trust  Co.  To 
these  accounts  the  banks  had  credited  interest  at  the  rate  of 
4%  per  annum.  Paid  to  widow  on  account  of  income,  voucher 
No.  41,  $1,400.00. 

January  15,  191 2 

Received  rental  on  leasehold  property  from  Goldsmith, 
Silver  &  Co.,  $15,000.00;  paid  J.  Sator  rental  of  leasehold 
property,  $7,000.00;  paid  Spear  &  Co.,  expenses  in  connection 
with  leasehold  property  as  follows :  voucher  No.  43,  insurance, 
$395.00;  voucher  No.  44,  repairs,  $1,612.00;  taxes,  $903.00, 
voucher  No.  45.  Make  a  suitable  provision  for  the  amortiza- 
tion of  the  leasehold. 


Fiduciary  Accounting 


February  15,  191 2 

Paid  renewal  premium  on  executors'  bond,  voucher  No. 
46,  $1,645.00  The  stock  of  United  Cigar  Mfrs.  Co.,  sold  at 
ioi}i,  less  usual  brokerage  and  tax. 

February  25,  191 2 

The  executors  pay  the  balance  of  the  legacies  and  bequests 
under  the  will ;  the  bond  and  mortgage  of  James  Kent  being 
assigned  to  Henry  Robinson  as  of  February  25,  1912;  Robin- 
son pays  to  the  executor  the  amount  of  the  tax  on  his  legacy. 

March  i,  191 2 

The  executors  sell  the  Iowa  farm  lands  for  $14,000.00; 
rent  of  Henry  Street  property  received;  interest  on  invest- 
ments due  on  this  date  received.  Paid  to  widow  on  account  of 
income,  voucher  No.  63,  $1,000.00.  Land  in  Florida  sold  for 
$1,000.00.  The  executors  make  the  following  investments: 
Bond  and  mortgage,  Fred  W.  Holden,  premises  southwest 
corner  West  Broadway  and  Thomas  Street,  Manhattan,  re- 
corded in  Section  i.  Liber  156  of  Mortgages,  page  150,  due 
March  i,  1916,  interest  5%  March  i  and  September  i, 
$75,000.00;  bond  and  mortgage,  Winan  Realty  Holding  Com- 
pany, premises  northwest  corner  Twelfth  Avenue  and  129th 
Street,  Manhattan,  recorded  in  Section  7,  Liber  290  of  Mort- 
gages, page  450,  due  March  i,  191 5,  interest  5%  March  i 
and  September  i,  $i,cxx),ooo.oo. 

April  i,  191 2 

Interest  due  on  Keepler  Bond  and  Mortgage  paid.  Paid 
Monroe  Trust  Co.,  one  year  rent  of  vault.  Paid  renewal  of  fire 
insurance  premium,  $15.00. 

May  I,  1912 

Executors  receive  the  interest  due  on  4%  gold  debentures. 
They  pay  half-yearly  portion  of  taxes  on  realty,  $125.00,  and 
on  personalty,  $1,210.00,  vouchers  No.  68  and  No.  69. 

26 


Fiduciary  Accounting 


May  3,  1912 

Sold  at  private  sale  N.  Y.  C.  4%  gold  debentures  at  95 
and  accrued  interest,  including  date  of  sale. 

June  i,  1912 

Rent  of  Henry  Street  property  received.  The  executors 
are  unable  to  realize  a  fair  price  for  the  stock  of  the  Goodrun 
Tire  Co.,  and  decide  to  hold  it  for  the  present. 

June  30,  1912 

The  Union  Trust  Co.  credits  interest  on  the  estate  account 
to  date,  $3,294,87.  The  following  amounts  are  paid  by  the 
executors :  R.  Brown,  C.  P.  A.,  audit  fee,  $5cx>.oo,  voucher 
No.  70 ;  postmaster,  postage,  $25.07,  voucher  No.  71 ;  Tower 
Stationery  Co.,  stationery,  $52.35,  voucher  No.  72.  C.  Robin- 
son has  elected  to  take  the  regular  commission  allowed  by 
law  in  lieu  of  his  bequest  under  the  terms  of  the  will.  The 
partnership  of  Smart  and  Williams  has  been  liquidated  with 
the  following  result:  a  new  corporation,  under  the  name  of 
The  Smart  and  Williams  Company  has  been  formed  to  take 
over  the  former  business;  the  estate  is  paid  the  sum  of  $150,- 
000.00,  representing  the  capital  contribution  of  the  decedent; 
the  new  company  pays  two  years'  purchase  of  the  average 
annual  profits  for  the  previous  three  years  for  the  goodwill 
of  the  old  firm ;  the  annual  average  profits  for  the  three-year 
period  were  $25,000.00;  the  new  corporation  took  the  busi- 
ness over  as  of  January  i,  1912,  and  the  profits  for  the  year 
ending  December  31,  191 1,  after  all  charges,  were  $24,050.00. 
Close  the  cash  book;  take  a  trial  balance  of  the  estate  ledger 
and  prepare  the  executors'  summary  statement  with  supporting 
schedules,  allowing  for  counsel's  fee  of  $5,000.00  and  the 
regular  commissions  allowed  by  law. 

July  20,  191 2 

The  Surrogate  allowed  the  executors  the  statutory  com- 
missions as  well  as  the  bill  of  G.  Bennett,  attorney  for  the 
executors,  amounting  to  $5,000.00     Close  the  books  of  the 

27 


Fiduciary  Accounting 

executors.  Open  the  books  of  the  trustees,  planning  the 
accounts  in  the  ledger  in  such  a  manner  as  to  facilitate  the 
preparation  of  the  trustees  'accounts  for  presentation  to  the 
Surrogate. 

The  student  must  enter  the  income  from  trust  invest- 
ments on  due  date  as  the  syllabus  will  not  mention  these  items 
in  future. 

August  i,  1912 

The  trustees  purchase  200  bonds,  par  value  $1,000.00  each, 
of  City  of  Rochester  bearing  interest  at  5%,  payable  February 
I  and  August  i,  amount  $208,572.40,  due  May  i,  191 7.  The 
Goodrun  Tire  Co.  stock  is  sold  for  $1,650.00,  less  usual  charges. 
The  balance  of  income  due  to  R.  &  W.  Mead  is  paid,  as  also 
is  the  balance  of  income  due  to  Mrs.  A.  C.  Smart. 

September  i,  1912 

The  trustees  receive  the  amount  due  on  principal  and  inter- 
est on  bond  of  C.  Stollerman. 

December  31,  1912 

Mrs.  A.  C.  Smart  is  killed  in  a  railroad  accident.  Prepare 
with  due  distinction  as  to  principal  and  income,  the  accounts 
of  the  trustees  for  the  period  ending  December  31,  19 12, 
together  with  the  necessary  schedules  showing  the  eflfect  upon 
the  trust  estate  of  the  death  of  Mrs.  Smart. 


28 


Fiduciary  Accounting 


SYNOPSIS   OF   DECEDENT   ESTATE   LAW   OF   NEW   YORK 

ARTICLE  I.     I.    Title.    2.    Definitions.    Will  includes  codicils. 

ARTICLE  II.  10.  All  persons,  except  idiots,  persons  of  unsound 
mind  and  infants,  may  devise  real  estate.  11.  Every  estate  and  interest 
in  real  property  descendible  to  heirs  may  be  devised.  12.  Such  devise 
of  real  property  may  be  made  to  every  person  capable  by  law  of  holding 
real  estate.  Corporations  must  be  authorized  by  charter  or  statute 
to  take  by  devise.  14.  Wills  expressly  or  in  terms  denoting  an 
intent  to  devise  all  real  estate  of  testator  pass  all  real  estate  testator 
was  entitled  to  devise  at  time  of  death.  15.  Males  18  years,  females 
16  years,  of  sound  mind  and  memory,  may  will  in  writing  personal 
estate.  16.  Nuncupative  or  unwritten  wills  of  personal  estate  are 
invalid  unless  made  by  soldier  in  actual  military  service  or  mariner 
at  sea.  17.  "No  person  having  a  husband,  wife,  child  or  parent,  shall, 
by  his  or  her  last  will  and  testament  devise  or  bequeath  to  any  benevo- 
lent, charitable,  literary,  scientific,  religious  or  missionary  society, 
association  or  corporation,  in  trust  or  otherwise,  more  than  one-half 
part  of  his  or  her  estate,  after  the  payment  of  his  or  her  debts,  and 
such  devise  or  bequest  shall  be  valid  to  the  extent  of  one-half  and 
no  more."  21.  Manner  of  execution  of  will:  Every  will  must  be  (a) 
subscribed  by  testator  at  end;  (b)  such  subscription  made  by  testator 
in  presence  of  each  attesting  witness,  or  acknowledged  to  have  been, 
so  made  to  each  attesting  witness ;  (c)  at  time  of  subscription,  or  at 
time  of  acknowledging,  testator  shall  declare  instrument  to  be  last 
will  and  testament;  (d)  at  least  two  attesting  witnesses,  each  to  sign 
his  name  as  witness  at  end  of  the  will,  at  request  of  testator.  22. 
Witnesses  must  write  addresses,  or  forfeit  $50.  Lack  of  address  no 
effect  on  will.  23.  "What  wills  may  be  proved?"  A  will  of  real  or 
personal  property,  executed  as  prescribed  by  the  laws  of  the  state, 
or  a  will  of  personal  property  executed  without  the  state,  and  within 
the  United  States,  the  Dominion  of  Canada,  or  the  Kingdom  of  Great 
Britain  and  Ireland,  as  prescribed  by  the  laws  of  the  state  or  country 
where  it  is  or  was  executed,  or  a  will  of  personal  property  executed 
by  a  person  not  a  resident  of  the  state,  according  to  the  laws  of  the 
testator's  residence,  may  be  admitted  to  probate  in  this  state.  24. 
Validity  of  execution  or  right  to  admit  to  probate  or  validity  or  con- 
struction of  any  provision  not  affected  by  change  of  testator's  residence 
since  execution  of  will.  25.  (Applies  to  old  wills.)  26.  Children 
born  after  making  of  will  unprovided  for  by  settlement,  and  not  men- 
tioned in  will,  have  same  right  as  though  there  were  no  will,  and  may 
recover  from  devisees  and  legatees  in  proportion  to  devises  and 
bequests.  27.  Witness  who  is  necessary  cannot  take  under  will  but 
may  take  to  extent  he  would  have  received  property  if  there  had  been 
no  will.  Cannot  get  more  than  will  allowed,  however.  28.  Gives 
right  of  action  to  child  born  after  making  the  will  or  to  subscribing 


Fiduciary  Accounting 

witness  as  provided  by  previous  sections.  29.  Personal  or  real  prop- 
erty shall  not  lapse  if  given  to  a  direct  lineal  descendant  or  brother 
or  sister  of  testator,  if  such  direct  lineal  descendant  or  brother  or 
sister  has  a  lineal  descendant  who  shall  take  property  as  if  legatee  or 
devisee  had  survived  the  testator  and  had  died  intestate.  30.  Clerk 
of  county,  or  register  of  deeds  in  city,  and  surrogate,  to  receive  wills 
delivered  by  persons  and  to  give  written  receipt.  31.  Sealing  and 
indorsing  wills  received  for  safe  keeping,  as  provided  in  section  30. 

32.  Such  wills  to  be  delivered  only  to  testator  in  person,  or  upon  written 
order  proved  by  oath  of  subscribing  witness,  or  after  his  death  to 
persons  named  in  indorsement,  or,  if  no  indorsement,  and  if  deposited 
with  any  other  officer  than  a  surrogate,  to   surrogate  of  the  county. 

33.  Opening  wills  received  by  surrogate  for  safe  keeping.  Deposit 
under  previous  sections,  to  be  opened,  etc.  34.  Wills,  except  in  cases 
mentioned  in  statute,  revoked  only  by  other  will  or  by  writing  declaring 
revocation  or  alteration  executed  with  same  formalities,  or  unless 
"burnt,  torn,  cancelled,  obliterated  or  destroyed,  with  the  intent  and 
for  the  purpose  of  revoking  the  same,  by  the  testator  himself,  or  by 
another  person  in  his  presence,  by  his  direction  and  consent;  and 
when  so  done  by  another  person  the  direction  and  consent  of  the 
testator  and  the  fact  of  such  injury  or  destruction  shall  be  proved 
by  at  least  two  witnesses.  35.  Subsequent  marriage  of  testator  and 
birth  of  issue  revokes  will  disposing  of  testator's  whole  estate,  if  wife 
or  such  issue  shall  survive  testator,  unless  such  issue  shall  have  been 
provided  for  or  mentioned  in  will,  36.  Will  executed  by  unmarried 
woman  revoked  by  her  subsequent  marriage.  37.  Agreement  for 
valuable  consideration  to  convey  property  devised  or  bequeathed  by 
a  will  previously  made  not  deemed  revocation  of  previous  devise  or 
bequest;  property  passes  to  devisee  or  legatee  subject  to  the  same 
remedies  on  the  agreement  that  would  have  lain  against  the  heirs  or 
next  of  kin  of  testator  had  the  property  descended  to  them.  38.  Giarge 
or  incumbrance  upon  real  or  personal  estate  does  not  revoke  any 
previous  will  disposing  of  same  estate;  property  passes,  subject  to 
such  charge  or  incumbrance.  39.  Any  instrument  that  alters  testa- 
tor's interest  in  specified  property  does  not  revoke  his  will  previously 
made  disposing  of  such  property,  unless  testator  declares  such  to  be 
his  intention  in  such  instrument;  legatee  or  devisee  acquires  same 
interest  that  would  have  descended  to  heir  or  next  of  kin.  40.  But 
if  provisions  of  instruments  by  which  alteration  is  made  are  wholly 
inconsistent  with  previous  devise  or  bequest,  instrument  operates  as 
revocation  (unless  provisions  depend  upon  condition  which  is  not 
performed,  or  contingency  not  happened).  41.  A  former  will  is  not 
revived  by  the  revocation  of  another  made  subsequently,  unless  it 
appears  by  the  terms  of  such  revocation  that  it  was  his  intention  to 
revive  the  former  will;  or  unless  he  duly  republishes  it.  42.  A 
will  of  real  property  which  has  been  duly  proved  may  be  recorded 
as  a  deed  of  real  property.  An  executor  or  administrator  with  will 
annexed  must  cause  copy  of  will  to  be  recorded  within  twenty  days 

30 


Fiduciary  Accounting 

after  letters  are  issued  to  him.  An  exemplification  of  record  of  such 
will  may  be  recorded  in  office  of  clerk  or  register  of  any  county. 
Such  record  must  be  received  in  evidence  as  original  will.  43.  Record 
or  exemplification  of  will  must  be  indexed  by  clerk  or  register  as  a 
deed  would  be.  44.  (Relates  to  recording  wills  proved  in  another 
state  or  foreign  country.)  45.  (See  section  44.)  46.  Title  of  bona 
fide  purchaser  from  heir  of  testator  is  good  against  devisee  unless 
will  shall  be  probated  or  established  within  four  years  from  death 
of  testator;  if  devisee  is  under  legal  disability  at  time  of  death  of 
testator,  or  will  shall  have  concealed  by  heir  of  testator,  term  of 
four  years  shall  not  begin  to  run  until  one  year  after  removal  of  such 
legal  disability  or  delivery  of  will  to  devisee  or  to  proper  surrogate. 
47.  Testamentary  disposition  of  real  estate  is  regulated  by  laws  of 
place  where  real  estate  is  situated,  without  regard  to  residence  of 
decedent;  testamentary  disposition  of  personality  governed  by  laws 
of  domicile  of  testator;  but  testator  resident  of  United  States  may 
by  declaration  in  his  will  elect  that  it  be  construed  and  regulated 
by  laws  of  this  state. 

ARTICLE  III.  Sect.  80.  (i)  This  section  defines  real  property 
generally  as  all  interest  in  lands  held  by  decedent;  "inheritance"  means 
real  property  descended  according  to  provisions  of  Article  III.  (2) 
Where  inheritance  shall  have  come  to  the  intestate  "on  the  part  of 
the  father  or  mother,"  this  includes  all  inheritance  which  shall  have 
come  from  that  parent  or  from  any  relatives  on  that  parent's  side. 
(3)  When  a  person  is  described  as  "living"  it  means  living  at  the  time 
of  death  of  intestate;  when  described  as  "having  died,"  it  means  that 
he  died  before  such  intestate.  (4)  Article  does  not  affect  a  limitation  of 
estate  by  deed  or  will  or  tenancy  by  the  courtesy  or  dower.  81. 
(Descent,  or  hereditary  succession,  is  the  title  whereby  a  person,  on 
the  death  of  his  blood  relative,  acquires  his  estate  by  right  of  repre- 
sentation. Sections  82-88,  inclusive,  cover  Statute  of  Descent.)  89, 
Estate  of  illegitimate  intestate,  dying  without  issue  entitled  to  inherit, 
passes  to  his  mother;  if  she  be  dead,  to  her  relatives.  Illegitimate 
issue  inherit  from  mother  only  in  case  there  are  no  legitimate  issue. 
90.  Relatives  of  the  half-blood  and  their  descendants  inherit  equally 
with  those  of  the  whole-blood ;  unless  the  inheritance  came  to  intestate 
by  descent  or  gift  from  an  ancestor,  in  which  case  all  those  who  are 
not  of  the  blood  of  such  ancestor  shall  be  excluded  from  such  inheri- 
tance. 91.  When  the  inheritance  shall  have  come  to  the  intestate 
from  a  deceased  husband  or  wife,  should  there  be  no  person  to  inherit 
under  the  preceding  sections,  then  such  real  property  of  such  intestate 
shall  descend  to  the  heirs  of  such  deceased  husband  or  wife.  92.  In 
cases  not  provided  for,  the  inheritance  shall  descend  according  to 
common  law.  93.  A  posthumous  child  inherits  as  if  born  in  the 
lifetime  of  intestate.  94.  When  one  person  alone  inherits  he  holds 
the  estate  solely;  two  or  more  heirs  hold  as  tenants  in  common,  in 
proportion  to  their  respective  interests.  95.  Alienism  of  ancestor  no 
bar  to  inheritance.     96.      "Advancements"  being  gifts  by  an  intestate 

31 


Fiduciary  Accounting 

to  a  child  by  settlement  or  portion,  including  estates  or  interests  given 
by  a  parent  to  a  descendant,  by  virtue  of  a  beneficial  power  or  power 
in  trust.  The  law  demands  that  the  value  of  such  advancements  shall 
be  reckoned  in  appraising  the  intestate's  estate  and  in  estimating  the 
share  of  the  descendant's  inheritance.  97.  When  an  advancement 
consisted  of  real  property,  adjustment  must  be  out  of  real  property; 
advancement  of  personal  property,  adjustment  of  personalty;  if  either 
is  insufficient,  adjustment  is  made  out  of  the  other.  98.  Treats  of  the 
Statute  of  Distributions.  99.  Repeats  the  provisions  of  section  96, 
with  regard  to  advancements  of  personalty.  100.  The  provisions 
as  to  distribution  apply  to  property  of  married  women  leaving  descend- 
ants. Husband  of  such  deceased  intestate  is  entitled  to  same  share 
that  a  widow  would  receive  of  her  husband's  personalty.  loi. 
Devisees  and  heirs  are  liable  for  debts  of  decedent  to  the  extent  of 
their  respective  inheritances.  102.  Liability  of  heir  or  devisee  not 
affected  by  preceding  section  where  will  makes  specific  provisions  for 
payment  of  debt.  103.  Husband  liable  as  administrator  for  debts  of 
wife  to  the  extent  of  assets  received  by  him.  104.  Incorporates  pro- 
visions of  section  2513  CCP.,  defining  terms  frequently  used  in 
Decedent  Estate  Law. 


EXECUTORS,    ADMINISTRATORS    AND    TESTAMENTARY 

TRUSTEES 

ARTICLE  IV.  Sect.  iio.  Executor  may  sell  property  situated  in 
New  York  State  as  he  deems  most  advantageous  to  those  interested 
therein,  iii.  Trust  funds  may  be  invested  in  the  same  kind  of  securi- 
ties as  are  authorized  investments  for  deposits  of  savings  banks  and 
in  bonds  and  mortgages  on  real  estate  worth  fifty  per  cent  more  than 
the  amount  loaned  thereon.  The  holder  of  trust  funds  may  require 
such  personal  bonds  of  guaranty  of  payment  as  may  seem  prudent, 
the  expense  of  premiums  on  such  guarantees  not  exceeding  one-half 
of  one  per  cent  per  annum,  or  par  value  of  investments,  to  be  paid 
out  of  income.  No  trustee  shall  purchase  securities  hereunder  from 
himself.  112.  The  law  no  longer  recognizes  an  executor  de  son  tort; 
any  individual  interfering  without  authority  with  the  property  of 
deceased  is  liable  as  wrongdoer.  113.  No  executor  shall  be  held  on 
his  promise  to  meet  the  indebtedness  of  estate  of  deceased,  unless 
the  promise  be  in  writing.  114.  The  executors  or  administrators  of  a 
deceased  person  who,  as  executor  administrator,  misappropriated  the 
funds  of  his  testator  or  intestate,  shall  be  liable  for  their  testator's 
(or  intestate's)  wrongdoing.  115.  When  the  administration  of  the 
effects  of  a  deceased  person  has  been  begim  by  one  executor,  and 
passes  on  to  another  executor  to  complete,  the  second  executor  shall 
have  all  legal  rights  in  the  prosecution  or  defense  of  any  action 
concerning  the  estate  that  the  original  executor  (or  administrator, 
or  intestate)  would  have  had,     116.    All  actions  on  account  and  upon 

32 


Fiduciary  Accountiug 

contract  may  be  maintained  by  and  against  executors  as  by  or  against 
their  respective  testators.  117.  Administrators  have  the  same  legal 
rights  and  liabilities  as  to  debts  owing  to  or  by  the  decedent  as  execu- 
tors. 118.  Administrators  or  executors  shall  have  actions  of  trespass 
for  damage  done  to  the  realty  or  personalty  of  the  deceased  in  his 
lifetime.  119.  Actions  of  trespass  shall  lie  against  executors  and 
administrators  for  damage  to  personalty  or  realty  done  by  the  deceased 
in  his  lifetime.  120.  Executors  or  administrators  shall  be  empowered 
to  institute  or  defend  actions  in  tort  arising  out  of  the  acts  of  their 
respective  decedents,  in  the  same  manner  as  actions  upon  contract. 
This  section  shall  not  extend  to  actions  for  personal  injuries  (except 
for  injuries  resulting  in  death  under  Section  3343  Code  Civ.  Pro.). 
121.  The  executor  of  an  executor  has  no  right  to  enter  into  the 
affairs  involving  the  estate  of  the  former  testator.  122.  This  section 
explains  by  what  standards  the  estate  of  a  deceased  person  shall  be 
appraised. 


33 


Fiduciary  Accounting 


IMPORTANT  SECTIONS  OF  THE  CODE  OF  CIVIL 
PROCEDURE 

Sect.  217.  GENERAL  JURISDICTION  OF  SUPREME  COURT. 
The  general  jurisdiction  in  law  and  equity,  which  the  supreme  court 
of  the  state  possesses,  under  the  provisions  of  the  Constitution,  includes 
all  the  jurisdiction  which  was  possessed  and  exercised  by  the  supreme 
court  of  the  colony  of  New  York,  at  any  time,  and  by  the  court  of 
chancery  in  England,  on  the  fourth  day  of  July,  seventeen  hundred 
and  seventy-six;  with  the  exceptions,  additions  and  limitations  created 
and  imposed  by  the  constitution  and  laws  of  the  state.  Subject  to 
those  exceptions  and  limitations,  the  supreme  court  of  the  state  has 
all  the  powers  and  authority  of  each  of  those  courts,  and  exercises 
the  same  in  like  manner. 

Sect.  383.     WITHIN  THREE  YEARS. 

1.  An  action  against  a  sheriff,  coroner,  constable,  or  other  officer, 
for  the  non-payment  of  money  collected  upon  an  execution. 

2.  An  action  against  a  constable,  upon  any  other  liability  incurred 
by  him,  by  doing  an  act  in  his  official  capacity,  or  by  the  omission  of 
an  official  duty ;  except  an  escape. 

3.  An  action  upon  a  statute,  for  a  penalty  or  forfeiture,  where  the 
action  is  given  to  the  person  aggrieved,  or  to  that  person  and  the  people 
of  the  State ;  except  where  the  statute  imposing  it  prescribes  a  different 
limitation. 

4.  An  action  against  an  executor,  administrator,  or  receiver,  or 
against  the  trustee  of  an  insolvent  debtor,  appointed,  as  prescribed  by 
law,  in  a  special  proceeding  instituted  in  a  court  or  before  a  judge, 
brought  to  recover  a  chattel,  or  damages  for  taking,  detaining  or  in- 
juring personal  property,  by  the  defendant,  or  the  person  whom  he 
represents. 

5.  An  action  to  recover  damages  for  a  personal  injury  resulting 
from  negligence. 

Sect.  755-  ACTION,  ETC.,  WHEN  NOT  TO  ABATE.  An 
action  does  not  abate  by  any  event,  if  the  cause  of  action  survives  or 
continues.  A  special  proceeding  does  not  abate  by  any  event,  if  the 
right  to  the  relief  sought  in  such  special  proceeding  survives  or  con- 
tinues, but  this  provision  as  to  a  special  proceeding  applies  only  to 
cases  where  a  party  dies  after  this  act  takes  effect. 

Sect.  811.  PARTY  NEED  NOT  JOIN;  WHEN  ONE  SURETY 
IS  SUFFICIENT.  Where  a  provision  of  this  act  requires  a  bond 
or  undertaking  with  sureties,  to  be  given  by,  or  in  behalf  of,  a  party 
or  other  person,  he  need  not  join  with  the  sureties  in  the  execution 
thereof,  unless  the  provision  requires  him  to  execute  the  same;  and 
the  execution  thereof  by  one  surety  is  sufficient,  although  the  word 
"sureties"  is  used,  unless  the  provision  expressly  requires  two  or 
more   sureties ;   and   the  execution  of  any  such  bond   or   undertaking 

34 


Fiduciary  Accounting 

by  any  fidelity  or  surety  company  authorized  by  the  laws  of  this  State 
to  transact  business,  shall  be  equivalent  to  the  execution  of  said  bond 
or  undertaking  by  two  sureties ;  and  such  company,  if  excepted  to, 
shall  justify  through  its  officers  or  attorney  in  the  manner  required 
by  law  of  fidelity  and  surety  companies.  Any  such  company  may 
execute  any  such  bond  or  undertaking  as  surety  by  the  hand  of  its 
officers,  or  attorney,  duly  authorized  thereto  by  resolution  of  its  board 
of  directors,  a  certified  copy  of  which  resolution,  under  the  seal  of 
said  company,  shall  be  filed  with  each  bond  or  undertaking. 

Sect.  812.  FORM  OF  UNDERTAKING;  AFFIDAVIT  OF 
SURETIES;  APPROVAL.  A  bond  or  undertaking,  executed  by  a 
surety  or  sureties,  as  prescribed  in  this  act,  must  where  two  or  more 
persons  execute  it,  be  joint  and  several  in  form;  and,  except  when 
executed  by  a  fidelity  or  surety  company,  or  when  otherwise  expressly 
prescribed  by  law,  it  must  be  accompanied  with  the  affidavit  of  each 
surety,  subjoined  thereto,  to  the  effect  that  he  is  a  resident  of  and  a 
householder  or  a  freeholder  within  the  State,  and  is  worth  the  penalty 
of  the  bond  or  twice  the  sum  specified  in  the  undertaking,  over  all 
the  debts  and  liabilities  which  he  owes  or  has  incurred,  and  exclusive 
of  property  exempt  by  law  from  levy  and  sale  under  an  execution.  A 
bond  or  undertaking  given  by  a  party  without  a  surety  must  be  accom- 
panied by  his  affidavit  to  the  same  effect.  The  bond  or  undertaking, 
except  as  otherwise  expressly  prescribed  by  law,  must  be  approved  by 
the  court  before  which  the  proceeding  is  taken,  or  a  judge  thereof, 
or  the  judge  before  whom  the  proceeding  is  taken.  The  approval  must 
be  endorsed  upon  the  bond  or  undertaking.  The  surety  or  sureties 
or  the  representatives  of  any  surety  or  sureties  upon  the  bond  here- 
tofore or  hereafter  executed,  of  any  trustee,  committee,  guardian,  as- 
signee, receiver,  executor,  administrator,  or  other  fiduciary,  shall  be 
entitled  as  a  matter  of  right  to  be,  and  shall  be,  discharged  from 
liability,  as  hereinafter  provided,  and  to  that  end  may  on  notice  to 
the  principal  named  in  such  bond,  apply  to  the  court  that  accepted 
such  bond,  or  to  the  court  of  which  the  judge  that  accepted  such 
bond  was  a  member,  or  to  any  judge  thereof,  praying  to  be  relieved 
from  liability  as  such  surety  or  sureties  for  the  act  or  omission  of 
such  principal  occurring  after  the  date  of  the  order  relieving  such 
surety  or  sureties  hereinafter  provided  for,  and  that  such  principal 
be  required  to  account  and  give  new  sureties.  Such  notice  of  such 
application  may  be  served  on  said  principal  personally  within  or  with- 
out the  State,  or,  not  less  than  five  days  prior  to  the  date  on  which 
such  application  is  to  be  made,  unless  it  satisfactorily  appears  to  the 
court,  or  a  judge  thereof,  that  personal  notice  cannot  be  given  with 
due  diligence  within  the  state,  in  which  case  notice  may  be  given  in 
such  manner  as  the  court  or  a  judge  thereof  directs.  Pending  the 
hearing  of  such  application  the  court  or  judge  may  restrain  such  prin- 
cipal from  acting  except  to  preserve  the  trust  estate  until  further  order. 
Upon  the  hearing  of  such  application,  if  the  principal  does  not  file  a 
new  bond,  in  the  usual  form,  to  the  satisfaction  of  the  court  or  judge, 

35 


Fiduciary  Accounting 

the  court  or  judge  must  make  an  order  requiring  the  principal  to 
file  a  new  bond  within  such  reasonable  time,  not  exceeding  five  days, 
as  the  court  or  judge  in  such  order  fixes.  If  such  new  bond  shall  be 
filed  upon  such  hearing  or  within  the  time  fixed  by  said  order,  the 
court  or  judge  must  thereupon  make  a  decree  or  order  requiring  the 
principal  to  account  for  all  his  acts  and  proceedings  to  and  including 
the  date  of  such  order,  and  to  file  such  account  within  a  time  fixed, 
not  exceeding  twenty  days,  and  releasing  the  surety  or  sureties  making 
such  application  from  liability  upon  the  bond  for  any  act  or  default 
of  the  principal  subsequent  to  the  date  of  such  decree  or  order.  If 
the  principal  fail  so  to  file  such  new  bond  within  the  time  specified, 
a  decree  or  order  must  be  made  revoking  the  appointment  of  such 
principal  or  removing  him,  and  requiring  him  to  so  account,  and  file 
such  account  within  twenty  days.  If  the  principal  fail  to  file  his 
account  as  in  this  section  provided,  such  surety  or  sureties,  or  repre- 
sentatives thereof,  may  make  and  file  such  account  with  like  force  and 
effect  as  though  made  and  filed  by  such  principal,  and  upon  the  settle- 
ment thereof  credit  shall  be  given  for  all  commissions,  costs,  disburse- 
ments and  allowances  to  which  the  principal  would  be  entitled  were 
he  accounting,  and  allowance  shall  be  made  to  such  surety  or  sureties, 
or  representative  for  the  expense  incurred  in  so  filing  such  account 
and  procuring  the  settlement  thereof.  And  after  the  filing  of  an 
account  as  required,  or  permitted,  in  this  section,  the  court  or  judge 
must,  upon  the  petition  of  the  principal,  or  surety  or  sureties,  or  the 
representatives  of  any  such  surety  or  sureties,  issue  an  order  requiring 
all  persons  interested  in  the  estate  or  trust  funds  to  attend  a  settle- 
ment of  such  account,  at  a  time  and  place  therein  specified,  and  upon 
the  trust  fund  or  estate  being  found,  or  made  good,  and  paid  over  or 
properly  secured,  the  surety  or  sureties  shall  be  discharged  from 
any  and  all  further  liability,  and  the  court  or  judge  shall  settle,  de- 
termine and  enforce  the  rights  and  liabilities  of  all  parties  to  the 
proceedings,  in  like  manner  and  to  the  same  extent  as  in  actions  for 
an  accounting  in  the  supreme  court.  And  upon  demand  made  in 
writing  by  the  principal,  such  surety  or  sureties,  or  representatives 
thereof,  shall  return  any  compensation,  that  has  been  paid  for  the 
unexpired  portion  of  such  suretyship. 

Sect.  813.  WHEN  SEVERAL  SURETIES  MAY  JUSTIFY. 
But  where  the  penalty  of  the  bond,  or  twice  the  sum  specified  in  the 
undertaking,  is  five  thousand  dollars,  or  upwards,  the  court  or  judge 
may,  in  its  or  his  discretion,  allow  the  sum  in  which  a  surety  is 
required  to  justify  to  be  made  up  by  the  justification  of  two  or  more 
sureties,  each  in  a  smaller  sum.  But  in  that  case  a  surety  cannot 
justify,  in  a  sum  less  than  five  thousand  dollars,  and  when  two  or 
more  sureties  are  required  by  law  to  justify,  the  same  person  cannot 
so  contribute  to  make  up  the  sum  for  more  than  one  of  them.  It  shall 
be  lawful  for  any  party  of  whom  a  bond  or  undertaking  is  required 
to  agree  with  his  sureties  for  the  deposit  of  any  or  all  moneys  for 
which  such  sureties  are  or  may  be  held  responsible  with  a  trust  com- 

36 


Fiduciary  Accounting 


^ 


pany  authorized  by  law  to  receive  deposits,  if  such  deposit  is  otherwise 
proper,  and  for  the  safekeeping  of  any  or  all  other  depositable  assets 
for  which  such  sureties  may  be  held  responsible,  with  a  safe  deposit 
company  authorized  by  law  to  do  business  as  such,  in  such  a  manner 
as  to  prevent  the  withdrawal  of  such  moneys  and  assets,  or  any  part 
thereof,  except  with  the  written  consent  of  such  sureties,  or  an  order 
of  the  court  made  on  such  notice  to  them,  as  it  may  direct. 

Sect.  829.  WHEN  PARTY,  ETC.,  CANNOT  BE  EXAMINED. 
Upon  the  trial  of  an  action,  or  the  hearing  upon  the  merits  of  a 
special  proceeding,  a  party  or  person  interested  in  the  event,  or  a 
person  from,  through  or  under  whom  such  a  party  or  interested  person 
derives  his  interest  or  title  by  assignment  or  otherwise,  shall  not  be 
examined  as  a  witness  in  his  own  behalf  or  interest,  or  in  behalf  of 
the  party  succeeding  to  his  title  or  interest,  against  the  executor, 
administrator  or  survivor  of  a  deceased  person,  or  the  committee  of 
a  lunatic,  or  a  person  deriving  his  title  or  interest  from,  through  or 
tinder  a  deceased  person  or  lunatic,  by  assignment  or  otherwise,  con- 
cerning a  personal  transaction  or  communication  between  the  witness 
and  the  deceased  person  or  lunatic,  except  where  the  executor,  admin- 
istrator, survivor,  committee  or  person  so  deriving  title  or  interest  is 
examined  in  his  own  behalf,  or  the  testimony  of  the  lunatic  or  deceased 
person  is  given  in  evidence  concerning  the  same  transaction  or  com- 
munication. A  person  shall  not  be  deemed  interested  for  the  purposes 
of  this  section  by  reason  of  being  a  stockholder  or  officer  of  any 
banking  corporation  which  is  a  party  to  this  action  or  proceeding,  or 
interested  in  the  event  thereof. 

Sect.  836.  APPLICATION  OF  THE  LAST  THREE  SEC- 
TIONS. The  last  three  sections  apply  to  any  examination  of  a 
person  as  a  witness,  unless  the  provisions  thereof  are  expressly  waived 
■upon  the  trial  or  examination  by  the  person  confessing,  the  patient  or 
the  client.  But  a  physician  or  surgeon  or  a  professional  or  registered 
nurse  may,  upon  a  trial  or  examination,  disclose  any  information  as 
to  the  mental  or  physical  condition  of  a  patient  who  is  deceased,  which 
he  acquired  in  attending  such  patient  professionajly,  except  confidential 
communications,  and  such  facts  as  would  tend  to  disgrace  the  memory 
of  the  patient,  when  the  provisions  of  section  834  have  been  expressly 
waived  on  such  trial  or  examination  by  the  personal  representatives 
of  the  deceased  patient,  or  if  the  validity  of  the  last  will  and  testament 
of  such  deceased  patient  is  in  question,  by  the  executor  or  executors 
named  in  said  will,  or  the  surviving  husband,  widow,  or  any  heir  at 
law  or  any  of  the  next  of  kin  of  such  deceased,  or  any  other  party 
in  interest.  But  nothing  herein  contained  shall  be  construed  to  dis- 
qualify an  attorney  in  the  probate  of  a  will  heretofore  executed  or 
offered  for  probate,  or  hereafter  to  be  executed  or  offered  for  probate, 
from  becoming  a  witness  as  to  its  preparation  and  execution,  in  case 
such  attorney  is  one  of  the  subscribing  witnesses  thereto.  In  an 
action  for  the  recovery  of  damages  for  a  personal  injury,  the  testimony 
of  a  physician  or  surgeon,  or  of  a  professional  or  registered  nurse  at- 

Z7 


Fiduciary  Accounting 

tached  to  any  hospital,  dispensary  or  other  charitable  institution,  as  to 
information  which  he  acquired  in  attending  a  patient  in  a  professional 
capacity  at  such  hospital,  dispensary,  or  other  charitable  institution, 
shall  be  taken  before  a  referee  appointed  by  a  judge  of  the  court  in 
which  such  action  is  pending;  provided,  however,  that  any  judge  of 
such  court,  at  any  time,  in  his  discretion,  may,  notwithstanding  such 
deposition,  order  that  a  subpoena  issue  for  the  attendance  and  examina- 
tion of  such  physician  or  surgeon,  or  professional  or  registered  nurse, 
upon  the  trial  of  action.  In  such  cases  a  copy  of  the  order  shall  be 
served,  together  with  the  subpoena.  Sections  872,  873,  874,  875,  876,  879, 
880,  884  and  886  of  this  code  apply  to  the  examination  of  a  physician 
or  surgeon,  or  a  professional  or  registered  nurse,  as  prescribed  in 
this  section.  The  waivers  herein  provided  for  must  be  made  in  open 
court  on  the  trial  of  the  action,  or  proceeding,  and  a  paper  executed 
by  a  party  prior  to  the  trial,  providing  for  such  waiver,  shall  be 
insufficient  as  such  a  waiver.  But  the  attorneys  for  the  respective 
parties  may,  prior  to  the  trial,  stipulate  for  such  waiver,  and  the  same 
shall  be  sufficient  therefor. 

Sect.  1652.  ACTION  BY  HEIR,  DEVISEE,  OR  GRANTOR. 
An  heir  or  devisee  may  maintain  an  action  for  waste  committed  in 
the  time  of  his  ancestor  or  testator,  as  well  as  in  his  own  time.  The 
grantor  of  a  reversion  may  maintain  an  action  for  waste  committed 
before  he  aliened  the  same. 

Sect.  1653.  ACTION  AGAINST  GUARDIAN.  Such  an  action 
may  also  be  maintained  against  a  guardian  by  his  ward,  either  before 
or  after  the  termination  of  the  guardianship,  for  waste  committed 
upon  the  real  property  of  the  ward  during  the  guardianship. 

Sect.  1819.  ACTION  BY  LEGATEE,  ETC.  If,  after  the  expira- 
tion of  one  year  from  the  granting  of  letters  testamentary  or  letters 
of  administration,  an  executor  or  administrator  refuses,  upon  demand, 
to  pay  a  legacy,  or  distributive  share,  the  person  entitled  thereto  may 
maintain  such  an  action  against  him  as  the  case  requires.  But  for 
the  purpose  of  computing  the  time,  within  which  such  an  action  must 
be  commenced,  the  cause  of  action  is  deemed  to  accrue,  when  the 
executor's  or  administrator's  account  is  judicially  settled,  and  not 
before. 

Sect.  1822.  LIMITATION  OF  ACTION  ON  REJECTED 
CLAIM.  Where  an  executor  or  administrator  disputes  or  rejects  a 
claim  against  the  estate  of  a  decedent,  exhibited  to  him,  either  before 
or  after  the  commencement  of  the  publication  of  a  notice  requiring 
the  presentation  of  claims,  as  prescribed  by  law,  unless  a  written  con- 
sent shall  be  filed  by  the  respective  parties  with  the  surrogate  that 
said  claim  may  be  heard  and  determined  by  him  upon  the  judicial 
settlement  of  the  accounts  of  said  executor  or  administrator,  as  pro- 
vided by  section  2743,  the  claimant  must  commence  an  action  for 
the  recovery  thereof  against  the  executor  or  administrator,  within  six 
months  after  the  dispute  or  rejection,  or,  if  no  part  of  the  debt  is 
then   due,   within   six   months   after   a   part   thereof  becomes   due;    in 

38 


Fiduciary  A ccou nting 

default  whereof,  he,  and  all  the  persons  claiming  under  him,  are 
forever  barred  from  maintaining  such  an  action  thereupon,  and  from 
every  other  remedy  to  enforce  payment  thereof  out  of  the  decedent's 
property. 

Sect.  1835.  WHEN  COSTS  AWARDED  AGAINST  EXECU- 
TOR, ETC.  Where  a  judgment  for  a  sum  of  money  only  is  rendered 
against  an  executor  or  administrator,  in  an  action  brought  against  him 
in  his  representative  capacity,  costs  shall  not  be  awarded  against  him, 
except  as  prescribed  in  the  next  section. 

Sect.  1836.  COSTS;  WHEN  AWARDED,  ETC  Where  it  ap- 
pears in  a  case  specified  in  the  last  section  that  the  plaintiff's  demand 
was  presented  within  the  time  limited  by  a  notice  published  as  pre- 
scribed by  law,  requiring  creditors  to  present  their  claims,  and  that 
the  payment  thereof  was  unreasonably  resisted  or  neglected,  or  that 
the  defendant  did  not  file  the  consent  provided  in  section  eighteen 
hundred  and  twenty-two  at  least  ten  days  before  the  expiration  of 
six  months  from  the  rejection  thereof,  the  court  may  award  costs 
against  the  executor  or  administrator,  to  be  collected  either  out  of 
his  individual  property  or  out  of  the  property  of  the  decedent,  as  the 
court  directs,  having  reference  to  the  facts  which  appear  upon  the 
trial.  Where  the  action  is  brought  in  the  supreme  court,  or  any 
county  court,  the  facts  must  be  certified  by  the  judge  or  referee  before 
whom  the  trial  took  place. 

Sect.  1837.  WHEN  ACTION  LIES  AGAINST  NEXT  OF  KIN, 
LEGATEES,  ETC.  An  action  may  be  maintained,  as  prescribed  in 
this  article,  against  the  surviving  husband  or  wife  of  a  decedent,  and 
the  next  of  kin  of  an  intestate,  or  the  next  of  kin  or  legatees  of  a 
testator,  to  recover,  to  the  extent  of  the  assets  paid  or  distributed  to 
them,  for  a  debt  of  the  decedent,  upon  which  an  action  might  have 
been  maintained  against  the  executor  or  administrator.  The  neglect 
of  the  creditor  to  present  his  claim  to  the  executor  or  administrator 
within  the  time  prescribed  by  law  for  that  purpose  does  not  impair 
his  right  to  maintain  such  an  action. 

Sect.  1861.  WHEN  ACTION  TO  ESTABLISH  WILL  An 
action  to  procure  a  judgment  establishing  a  will,  may  be  maintained,  by 
any  person  interested  in  the  establishment  thereof,  in  either  of  the 
following  cases : 

1.  Where  a  will  of  real  or  personal  property,  or  both,  has  been 
executed,  in  such  a  manner  and  under  such  circumstances  that  it 
might,  under  the  laws  of  the  state,  be  admitted  to  probate  in  a  surro- 
gate's court;  but  the  original  will  is  in  another  state  or  country,  under 
such  circumstances  that  it  cannot  be  obtained  for  that  purpose ;  or  has 
been  lost  or  destroyed,  by  accident  or  design,  before  it  was  duly  proved 
and  recorded  within  the  state. 

2.  Where  a  will  of  personal  property,  made  by  a  person  who 
resided  without  the  state,  at  the  time  of  the  execution  thereof,  or  at 
the  time  of  his  death,  has  been  duly  executed,  according  to  the  laws 
of  the  state  or  country  in  which  it  was  executed,  or  in  which  the 

39 


Fiduciary  A  ceo un  ting 

testator  resided  at  the  time  of  his  death,  and  the  case  is  not  one, 
where  the  will  can  be  admitted  to  probate  in  a  surrogate's  court 
under  the  laws  of  the  state. 

Sect.  1867.  ARTICLE  APPLIES  TO  ALL  WILLS.  The  pro- 
visions of  this  article  apply  as  well  to  wills  made  before,  as  to  those 
made  after,  this  article  takes  effect. 

Sect.  1870.  NEXT  OF  KIN  DEFINED.  The  term,  "next  of 
kin,"  as  used  in  this  title,  includes  all  those  entitled,  under  the  pro- 
visions of  law  relating  to  the  distribution  of  personal  property,  to 
share  in  the  unbequeathed  assets  of  a  decedent  after  payment  of 
debts  and  expenses,  other  than  a  surviving  husband  or  wife. 

Sect.  2472.  GENERAL  JURISDICTION  OF  SURROGATE. 
Each  surrogate  must  hold,  within  his  county,  a  court,  which  has,  in 
addition  to  the  powers  conferred  upon  it,  or  upon  the  surrogate,  by 
special  provision  of  law,  jurisdiction  as  follows : 

1.  To  take  the  proof  of  wills;  to  admit  wills  to  probate;  to  revoke 
the  probate  thereof;  and  to  take  and  revoke  probate  of  heirship. 

2.  To  grant  and  revoke  letters  testamentary  and  letters  of  admin- 
istration, and  to  appoint  a  successor  in  place  of  a  person  whose  letters 
have  been  revoked. 

3.  To  direct  and  control  the  conduct,  and  settle  the  accounts,  of 
executors,  administrators  and  testamentary  trustees;  to  remove  testa- 
mentary trustees,  and  to  appoint  a  successor  in  place  of  a  testamentary 
trustee  so  removed. 

4.  To  enforce  the  payment  of  debts  and  legacies;  the  distribution 
of  the  estates  of  decedents ;  and  the  payment  of  delivery,  by  executors, 
administrators  and  testamentary  trustees,  of  money  or  other  property 
in  their  possession  belonging  to  the  estate. 

5.  To  direct  the  disposition  of  real  property,  and  interests  in 
real  property  of  decedents,  for  the  payment  of  their  debts  and  funeral 
expenses,  and  the  disposition  of  the  proceeds  thereof. 

6.  To  administer  justice,  in  all  matters  relating  to  the  affairs  of 
decedents    according  to  the  provisions  of  the  statutes  relating  thereto. 

7.  To  appoint  and  remove  guardians  for  infants;  to  compel  the 
payment  and  delivery  by  them  of  money  or  other  property  belonging 
to  their  wards;  and,  in  the  cases  specially  prescribed  by  law,  to  direct 
and  control  their  conduct  and  settle  their  accounts. 

8.  To  settle  the  accounts  of  a  father,  mother,  or  other  relative, 
having  the  rights,  powers  and  duties  of  a  guardian  in  socage,  and  to 
compel  the  payment  and  delivery  of  money  or  other  property  belonging 
to  the  ward.  This  jurisdiction  must  be  exercised  in  the  cases  in  the 
manner  prescribed  by  statute. 

Sect.  2472a.  JURISDICTION  OF  SURROGATE'S  COURT  TO 
ASCERTAIN  TITLE  TO  LEGACIES,  ETC.  The  surrogate's  court 
has  also  jurisdiction  upon  a  judicial  accounting  or  proceeding  for  the 
payment  of  a  legacy  to  ascertain  the  title  to  any  legacy  or  distributive 
share,  to  set  off  a  debt  against  the  same,  and  for  that  purpose  ascertain 
whether  the   debt  exists,  to  affect  the  accounting  party  with  a  con- 

40 


Fiduciary  Accounting 

structive  trust,  and  to  exercise  all  other  power,  legal  or  equitable, 
necessary  to  complete  disposition  of  the  matter.  He  must  order  the 
trial  of  any  controverted  question  of  fact  of  which  either  party  has 
constitutional  right  of  trial  by  jury  and  seasonably  demands  the  same. 
Sect.  2476.  WHEN  JURISDICTION  EXCLUSIVE.  The  surro- 
gate's court  of  each  county  has  jurisdiction,  exclusive  of  every  other 
surrogate's  court,  to  take  the  proof  of  a  will,  and  to  grant  letters 
testamentary  thereupon,  or  to  grant  letters  of  administration,  as  the 
case  requires,  in  either  of  the  following  cases: 

1.  Where  the  decedent  was,  at  the  time  of  his  death,  a  resident 
of  that  county,  whether  his  death  happened  there  or  elsewhere. 

2.  Where  the  decedent,  not  being  a  resident  of  the  state,  died 
within  that  county,  leaving  personal  property  within  the  state,  or 
leaving  personal  property  which  has,  since  his  death,  come  into  the 
state  and   remains  unadministered. 

3.  Where  the  decedent,  not  being  a  resident  of  the  state,  died 
without  the  state,  leaving  personal  property  within  that  county,  and 
no  other;  or  leaving  personal  property  which  has,  since  his  death, 
come  into  that  county,  and  no  other,  and  remains  unadministered. 

4.  Where  the  decedent  was  not,  at  the  time  of  his  death,  a  resident 
of  the  state,  and  a  petition  for  probate  of  his  will,  or  for  a  grant  of 
letters  of  administration,  under  subdivision  second  or  third  of  this 
section,  has  not  been  filed  in  any  surrogate's  court;  but  real  property 
of  the  decedent,  to  which  the  will  relates,  or  which  is  subject  to 
disposition  under  title  fifth  of  this  chapter,  is  situated  within  that 
county,  and  no  other. 

Sect.  2481.  INCIDENTAL  POWERS  OF  SURROGATES.  A 
surrogate,  in  court  or  out  of  court,  as  the  case  requires,  has  power : 

1.  To  issue  citations  to  parties  in  any  matter  within  the  jurisdic- 
tion of  his  court;  and,  in  a  case  prescribed  by  law,  to  compel  the 
attendance  of  a  party. 

2.  To  adjourn,  from  time  to  time,  a  hearing  or  other  proceeding 
in  his  court;  and  where  all  persons  who  are  necessary  parties  have 
not  been  cited  or  notified,  and  citation  or  notice  has  not  been  waived 
by  appearance  or  otherwise,  it  is  his  duty,  before  proceeding  further, 
so  to  adjourn  the  same,  and  to  issue  a  supplemental  citation,  or  require 
the  petitioner  to  give  an  additional  notice,  as  may  be  necessary. 

3.  To  issue,  under  the  seal  of  the  court,  a  subpoena,  requiring 
the  attendance  of  a  witness  residing  or  being  in  any  part  of  the  state; 
or  a  subpoena  duces  tecum,  requiring  such  attendance,  and  the  pro- 
duction of  a  book  or  paper  material  to  an  inquiry  pending  in  the 
court. 

4.  To  enjoin,  by  order,  an  executor,  administrator,  testamentary 
trustee,  or  guardian,  to  whom  a  citation  or  other  process  has  been 
duly  issued  from  his  court,  from  acting  as  such,  until  the  further  order 
of  the  court. 

5.  To  require,  by  order,  an  executor,  administrator,  testamentary 
trustee,  or  guardian,  subject  to  the  jurisdiction  of  his  court,  to  perform 

41 


Fiduciary  Accounting 

any  duty  imposed  upon  him,  by  statute,  or  by  the  surrogate's  court, 
under  authority  of  a  statute. 

6.  To  open,  vacate,  modify,  or  set  aside,  or  to  enter,  as  of  a  former 
time,  a  decree  or  order  of  his  court;  or  to  grant  a  new  trial  or  a  new 
hearing  for  fraud,  newly  discovered  evidence,  clerical  error,  or  other 
sufficient  cause.  The  powers,  conferred  by  this  subdivision,  must  be 
exercised  only  in  a  like  case  and  in  the  same  manner,  as  a  court  of 
record  and  of  general  jurisdiction  exercises  the  same  powers.  Upon 
an  appeal  from  a  determination  of  the  surrogate,  made  upon  an  appli- 
cation pursuant  to  this  subdivision,  the  general  term  of  the  supreme 
court  has  the  same  power  as  the  surrogate;  and  his  determination 
must  be  reviewed,  as  if  an  original  application  was  made  to  that  term. 

7.  To  punish  any  person  for  a  contempt  of  his  court,  civil  or 
criminal,  in  any  case,  where  it  is  expressly  prescribed  by  law  that  a 
court  of  record  may  punish  a  person  for  a  similar  contempt,  and  in 
like  manner. 

8.  Subject  to  the  provisions  of  law,  relating  to  the  disqualification 
of  a  judge  in  certain  cases,  to  complete  an  unfinished  business,  pending 
before  his  predecessor  in  the  office,  including  proofs,  accountings  and 
examinations. 

9.  To  complete,  and  certify  and  sign  in  his  own  name,  adding 
to  his  signature  the  date  of  so  doing,  all  records  of  papers  left  uncom- 
pleted or  unsigned  by  any  of  his  predecessors. 

ID.  To  exemplify  and  certify  transcripts  of  all  records  of  his 
court,  or  other  papers  remaining  therein. 

11.  With  respect  to  any  matter  not  expressly  provided  for  in  the 
foregoing  subdivisions  of  this  section,  to  proceed,  in  all  matters  subject 
to  the  cognizance  of  his  court,  according  to  the  course  and  practice 
of  a  court,  having,  by  the  common  law,  jurisdiction  of  such  matters, 
except  as  otherwise  prescribed  by  statute;  and  to  exercise  such  inci- 
dental powers,  as  are  necessary  to  carry  into  effect  the  powers  expressly 
conferred. 

12.  A  surrogate,  or  a  clerk  of  the  surrogate's  court,  has  power 
to  administer  oaths,  to  take  affidavits  and  the  proof  and  acknowledg- 
ment of  deeds,  and  all  other  instruments,  in  writing,  and  certify  the 
same,  with  the  same  force  and  effect  as  if  taken  and  certified  by  a 
county  judge. 

Sect.  2514.  DEFINITION  OF  EXPRESSIONS  USED  IN  THIS 
CHAPTER.  In  construing  the  provisions  of  this  chapter,  the  following 
rules  must  be  observed,  except  where  a  contrary  intent  is  expressly 
declared  in  the  provision  to  be  construed,  or  plainly  apparent  from 
the  context  thereof: 

1.  The  word,  "intestate"  signifies  a  person  who  died  without 
leaving  a  valid  will;  but  where  it  is  used  with  respect  to  particular 
property,  it  signifies  a  person  who  died  without  effectually  disposing 
of  that  property  by  will,  whether  he  left  a  will  or  not. 

2.  The  word,  "assets"  signifies  personal  property  applicable  to 
the  payment  of  the  debts  of  a  decedent, 

42 


Fiduciary  Accounting 

3.  The  word,  "debts"  includes  every  claim  and  demand,  upon 
which  a  judgment  for  a  sum  of  money,  or  directing  the  payment  of 
money,  could  be  recovered  in  an  action;  and  the  word,  "creditor" 
includes  every  person  having  such  a  claim  or  demand,  any  person 
having  a  claim  for  expense  of  administration,  or  any  person  having 
a  claim  for  funeral  expenses. 

4.  The  word,  "will"  signifies  a  last  will  and  testament,  and  in- 
cludes all  the  codicils  to  a  will. 

5.  The  expression,  "letters  of  administration,"  includes  letters 
of  temporary  administration. 

6.  The  expression,  "testamentary  trustee,"  includes  every  person, 
except  an  executor,  an  administrator  with  the  will  annexed,  or  a 
guardian,  who  is  designated  by  a  will,  or  by  any  competent  authority,  to 
execute  a  trust  created  by  a  will;  and  it  includes  such  an  executor  or 
administrator,  where  he  is  acting  in  the  execution  of  a  trust  created 
by  the  will,  which  is  separable  from  his  functions  as  executor  or 
administrator. 

7.  The  word,  "surrogate,"  where  it  is  used  in  the  text,  or  in  a 
bond  or  undertaking,  given  pursuant  to  any  provision  of  this  chapter, 
includes  every  officer  or  court  vested  by  law  with  the  functions  of 
surrogate. 

8.  The  expression,  "judicial  settlement,"  where  it  is  applied  to 
an  account,  signifies  a  decree  of  a  surrogate's  court,  whereby  the 
account  is  made  conclusive  upon  the  parties  to  the  special  proceeding, 
either  for  all  purposes,  or  for  certain  purposes  specified  in  the  statute; 
and  an  account  thus  made  conclusive  is  said  to  be  "judicially  settled." 

9.  The  expression,  "intermediate  account,"  denotes  an  account 
filed  in  the  surrogate's  office,  for  the  purpose  of  disclosing  the  acts  of 
the  person  accounting,  and  the  condition  of  the  estate  or  fund  in 
his  hands  and  not  made  the  subject  of  a  judicial  settlement. 

10.  The  expression,  "upon  the  return  of  a  citation,"  where  it  is 
used  in  a  provision  requiring  an  act  to  be  done  in  the  surrogate's 
court,  relates  to  the  time  and  place  at  which  the  citation  is  returnable, 
or  to  which  the  hearing  is  adjourned;  includes  a  supplemental  citation, 
issued  to  bring  in  a  party  who  ought  to  be,  but  has  not  been  cited; 
and  implies  that,  before  doing  the  act  specified,  due  proof  must  be 
made,  that  all  persons  required  to  be  cited  have  been  duly  cited. 

11.  The  expression,  "person  interested,"  where  it  is  used  in  con- 
nection with  an  estate  or  a  fund,  includes  every  person  entitled,  either 
absolutely  or  contingently,  to  share  in  the  estate  or  the  proceeds  thereof, 
or  in  the  fund,  as  husband,  wife,  legatee,  next  of  kin,  heir,  devisee, 
assignee,  grantee,  or  otherwise,  except  as  a  creditor.  Where  a  pro- 
vision of  this  chapter  prescribes  that  a  person  interested  may  object 
to  an  appointment,  or  may  apply  for  an  inventory,  an  account,  or 
increased  security,  an  allegation  of  his  interest,  duly  verified,  suffices, 
although  his  interest  is  disputed,  unless  he  has  been  excluded  by 
a  judgment,  decree  or  other  final  determination,  and  no  appeal  there- 
from is  pending. 

43 


Fiduciary  Accounting 

12.  The  term,  "next  of  kin,"  includes  all  those  entitled,  under 
the  provisions  of  law  relating  to  the  distribution  of  personal  property, 
to  share  in  the  unbequeathed  residue  of  the  assets  of  a  decedent 
after  payment  of  debts  and  expenses,  other  than  a  surviving  husband 
or  wife. 

13.  The  expression,  "real  property,"  includes  every  estate,  interest 
and  right,  legal  or  equitable,  in  lands,  tenements,  or  hereditaments, 
except  those  which  are  determined  or  extinguished  by  the  death  of 
a  person  seized  or  possessed  thereof,  or  in  any  manner  entitled  thereto, 
and  except  those  which  are  declared  by  law  to  be  assets.  The  word, 
"inheritance"  signifies  real  property,  as  defined  in  this  subdivision, 
descended  as  prescribed  by  law.  The  expression,  "personal  property," 
signifies  every  kind  of  property,  which  survives  a  decedent,  other  than 
real  property,  as  defined  in  this  subdivision,  and  includes  a  right  of 
action  conferred  by  special  statutory  provision  upon  an  executor  or 
administrator. 

Sect.  2544-  WITNESS  TO  WILL  NOT  DISQUALIFIED.  A 
person  is  not  disqualified  or  excused,  from  testifying  respecting  the 
execution  of  a  will  by  a  provision  therein,  whether  it  is  beneficial  to 
him  or  otherwise. 

Sect.  2562.  ADDITIONAL  ALLOWANCE  ON  TRIAL  AND 
SETTLING  ACCOUNTS.  In  addition  to  the  sums  specified  in  the 
last  two  sections,  the  surrogate  may,  in  his  discretion,  allow  to  an 
executor,  administrator,  guardian,  or  testamentary  trustee,  upon  a 
judicial  settlement  of  his  account,  or  on  an  intermediate  accounting 
required  by  the  surrogate,  such  a  sum,  as  the  surrogate  deems  reason- 
able, for  his  counsel  fees  and  other  expenses,  not  exceeding  ten  dollars 
for  each  day  occupied  in  the  trial,  and  necessarily  occupied  in  prepar- 
ing his  account  for  settlement,  and  otherwise  preparing  for  the  trial. 

Sect.  2563.  ALLOWANCE  ON  SALE  OF  REAL  ESTATE. 
Upon  the  disposition  of  real  property  of  a  decedent,  as  prescribed  in 
title  fifth  of  this  chapter,  the  executor,  administrator,  or  freeholder, 
disposing  of  the  property,  must  be  allowed  by  the  surrogate,  out  of 
the  proceeds  of  the  sale  brought  into  court,  his  expenses;  and  he 
may  be  allowed,  out  of  the  proceeds  a  reasonable  sum  for  his  own 
services,  not  exceeding  five  dollars  for  each  day,  actually  and  neces- 
sarily occupied  by  him  in  disposing  of  the  property,  and  such  a  further 
sum  as  the  surrogate  thinks  reasonable,  for  the  necessary  services  of 
his  attorney  and  counsel  therein. 

Sect.  2564.  WHEN  ALLOWANCE  IS  IN  LIEU  OF  COMMIS- 
SIONS. The  allowances  specified  in  the  last  section  are  in  lieu  of 
commissions. 

Sect.  2583.  DECREE  REVOKING  PROBATE  OR  LETTERS, 
ETC,  NOT  STAYED.  An  appeal  from  a  decree  revoking  the  probate 
of  a  will,  or  revoking  letters  testamentary,  letters  of  administration, 
or  letters  of  guardianship;  or  from  a  decree  or  an  order,  suspending 
an  executor,  administrator,  or  guardian,  or  removing  or  suspending 
a  testamentary  trustee,  or  a  freeholder,  appointed  to  execute  a  decree, 

44 


F  id  u  c  ia  ry  A  c  com  it  in  g 

as  prescribed  in  title  fifth  of  this  chapter,  or  appointing  a  temporary 
administrator,  or  an  appraiser  of  personal  property,  does  not  stay  the 
execution  of  the  decree  or  order  appealed   from. 

Sect.  2594.  OATHS  OF  EXECUTORS,  ADMINISTRATORS 
AND  GUARDIANS.  The  official  oath  or  affirmation  of  an  executor, 
administrator,  or  guardian,  to  the  effect  that  he  will  well,  faithfully, 
and  honestly  discharge  the  duties  of  his  office,  describing  it,  must  be 
filed  with  the  surrogate  before  letters  are  issued  to  him.  The  oath 
may  be  taken  before  any  other  officer,  within  or  without  the  state, 
who  is  authorized  to  take  an  affidavit,  to  be  used  in  the  supreme  court. 
Where  it  is  taken  without  the  state,  it  must  be  certified  as  required 
by  law,  with  respect  to  an  affidavit  to  be  used  in  the  supreme  court. 

Sect.  2595.  DEPOSIT  OF  SECURITIES  TO  REDUCE  PEN- 
ALTY OF  BOND.  In  a  case  where  a  bond,  or  new  sureties  to  a  bond, 
may  be  required  by  a  surrogate  from  an  executor,  administrator,  guar- 
dian, or  other  trustee,  if  the  value  of  the  estate  or  fund  is  so  great 
that  the  surrogate  deems  it  inexpedient  to  require  security  in  the  full 
amount  prescribed  by  law,  he  may  direct  that  any  securities  for  the 
payment  of  money  belonging  to  the  estate  or  fund  be  deposited  with 
him,  to  be  delivered  to  the  county  treasurer,  or  be  deposited  subject 
to  the  order  of  trustee,  countersigned  by  the  surrogate,  with  a  trust 
company  duly  authorized  by  law  to  receive  the  same.  After  such 
deposit  has  been  made,  the  surrogate  may  fix  the  amount  of  the  bond 
with  respect  to  the  value  of  the  remainder  only  of  the  estate  or 
fund.  A  security  thus  deposited  shall  not  be  withdrawn  from  the 
custody  of  the  county  treasurer  or  trust  company,  and  no  person 
other  than  the  county  treasurer  or  the  proper  officer  of  the  trust 
company,  shall  receive  or  collect  any  of  the  principal  or  interest 
secured  thereby,  without  the  special  order  of  the  surrogate  entered  in 
the  appropriate  book.  Such  an  order  can  be  made  in  favor  of  the 
trustee  appointed,  only  where  an  additional  bond  has  been  given  by 
him,  or  upon  proof  that  the  estate  or  fund  has  been  so  reduced  by 
payments  or  otherwise,  that  the  penalty  of  the  bond  originally  given 
will  be  sufficient  in  amount  to  satisfy  the  provisions  of  law  relating 
to  the  penalty  thereof,  if  the  security  so  withdrawn  is  also  reckoned 
in  the  estate  or  fund. 

Sect.  2602.  ON  DISAGREEMENT  OF  EXECUTORS,  ETC, 
SURROGATE  DIRECT  CUSTODY  OR  DEPOSIT.  Where  two 
or  more  co-executors  or  co-administrators  disagree,  respecting  the 
custody  of  money  or  other  property  of  the  estate;  or  two  or  more 
testamentary  trustees  or  guardians  of  the  property  disagree,  respecting 
the  custody  of  money  or  other  property,  belonging  to  a  fund  or  an 
estate  which  is  committed  to  their  joint  charge,  the  surrogate  may,  upon 
the  application  of  either  of  them,  or  of  a  creditor  or  person  interested 
in  the  estate,  and  proof,  by  affidavit,  of  the  facts,  make  an  order, 
requiring  them  to  show  cause,  why  the  surrogate  should  not  give 
directions  in  the  premises.  Upon  the  return  of  the  order,  the  surrogate 
may,   in   his  discretion,   make   an   order,   directing  that  any  property, 

45 


Fiduciary  Accounting 

of  the  estate  or  fund  be  deposited  in  a  safe  place,  in  the  joint  custody 
of  the  executors,  administrators,  guardians,  or  testamentary  trustees, 
as  the  case  requires,  or  subject  to  their  joint  order;  or  that  the  money 
of  the  estate  be  deposited  in  a  specified  safe  bank  or  trust  company, 
to  their  joint  credit,  and  to  be  drawn  out  upon  their  joint  order. 
Disobedience  to  such  a  direction  may  be  punished  as  a  contempt  of 
the  court. 

Sect.  2605.  SUCCESSOR  MAY  BE  APPOINTED;  POWERS; 
MAY  COMPEL  ACCOUNTING.  Where  letters  have  been  revoked 
by  a  decree  of  the  surrogate's  court,  that  court  has,  except  in  a  case 
where  it  is  otherwise  specially  prescribed  by  law,  the  same  power 
to  appoint  a  successor  to  the  person  whose  powers  have  ceased,  as  if 
the  letters  had  not  been  issued.  The  successor  may  complete  the 
execution  of  the  trust  committed  to  his  predecessor;  he  may  continue, 
in  his  own  name,  a  civil  action  or  special  proceeding,  pending  in  favor 
of  his  predecessor;  and  he  may  enforce  a  judgment,  order,  or  decree, 
in  favor  of  the  latter.  The  surrogate's  court  has  the  same  jurisdiction, 
upon  the  petition  of  the  successor,  or  of  a  remaining  executor,  admin- 
istrator, guardian  or  trustee,  to  compel  the  person  whose  letters  have 
been  revoked,  to  account  for,  or  deliver  over  money  or  other  property, 
and  to  settle  his  account,  which  it  would  have  upon  the  petition  of 
a  creditor  or  person  interested  in  the  estate,  if  the  term  of  office,  con- 
ferred by  the  letters,  had  expired  by  its  own  limitation. 

Sect.  2606.  ACCOUNTING  BY  EXECUTORS,  ETC.,  OF  DE- 
CEASED EXECUTOR.  Where  an  executor,  administrator,  guardian 
or  testamentary  trustee  dies,  the  surrogate's  court  has  the  same  juris- 
diction, upon  the  petition  of  his  successor,  or  of  a  surviving  executor, 
administrator,  or  guardian,  or  of  a  creditor,  or  person  interested  in  the 
estate,  or  of  a  guardian's  ward  of  the  legal  representative  of  a  deceased 
ward,  or  a  surety  upon  the  official  bond  of  the  decedent,  or  the  legal 
representative  of  a  deceased  surety,  to  compel  the  executor  or  adminis- 
trator of  the  decedent  to  account,  which  it  would  have  against  the 
decedent  if  his  letters  have  been  revoked  by  a  surrogate's  decree.  And 
an  executor  or  administrator  of  a  deceased  executor,  administrator, 
guardian,  or  testamentary  trustee  may  voluntarily  account  for  the  acts 
and  doings  of  the  decedent,  and  for  the  trust  property  which  had 
come  into  his  possession  or  into  the  possession  of  the  decedent.  And 
on  the  death,  heretofore  or  hereafter,  of  any  executor,  administrator, 
guardian  or  testamentary  trustee,  while  an  accounting  by  or  against 
him,  as  such,  was  or  is  pending  before  a  surrogate's  court,  such  court 
may  revive  said  proceeding  against  his  executor,  administrator  or 
successor  and  proceed  with  such  accounting  and  determine  all  ques- 
tions and  grant  any  relief  that  the  surrogate  would  have  power  to 
determine  or  grant  in  case  such  decedent  had  not  died  or  in  a  case 
where  the  executor  or  administrator  of  said  last  mentioned  decedent, 
acting  at  the  time  of  such  revival,  had  voluntarily  petitioned  for  an 
accounting  as  provided  for  in  this  section.  On  a  petition  filed  either 
by  or   against  an  executor  or  administrator  of  a   deceased   executor, 

46 


Fiduciary  Accounting 

administrator,  guardian  or  testamentary  trustee,  or  on  a  revival  and 
continuation  of  an  accounting  pending  by  or  against  such  decedent 
at  the  time  of  his  death,  the  successor  of  such  decedent  and  all  persons 
who  would  be  necessary  parties  to  a  proceeding  commenced  by  such 
decedent  for  a  judicial  settlement  of  his  accounts  shall  be  cited  and 
required  to  attend  such  settlement.  The  surrogate's  court  may  at 
any  time  on  its  own  motion  or  on  the  motion  of  any  party  to  any 
one  of  two  or  more  of  such  proceedings,  consolidate  said  proceedings, 
but  without  prejudice  to  the  power  of  the  court  to  make  any  subse- 
quent orders  in  either  of  them.  With  respect  to  the  liability  of  the 
sureties  in  and  for  the  purpose  of  maintaining  an  action  upon  the 
decedent's  official  bond,  a  decree  against  his  executor  or  adminis- 
trator, rendered  upon  such  an  accounting,  has  the  same  effect  as  if 
an  execution  issued  upon  a  surrogate's  decree  against  the  property 
of  decedent  had  been  returned  unsatisfied  during  the  decedent's  life- 
time. So  far  as  concerns  the  executor  or  administrator  of  decedent, 
such  a  decree  is  not  within  the  provisions  of  section  twenty-five  hun- 
dred and  fifty-two  of  this  act.  The  surrogate's  court  has  also  juris- 
diction to  compel  the  executor  or  administrator,  or  successor  of  any 
decedent,  at  any  time  to  deliver  over  any  of  the  trust  property  which 
has  come  to  his  possession  or  is  under  his  control,  and  if  the  same 
is  delivered  over  after  a  decree,  the  court  must  allow  such  credit  upon 
the  decree  as  justice  requires. 

Sect.  2612.  PERSONS  INCOMPETENT  TO  SERVE  AS  EX- 
ECUTORS. No  person  is  competent  to  serve  as  an  executor  who, 
at  the  time  the  will  is  proved,  is : 

1.  Incapable  in  law  of  making  a  contract. 

2.  Under  the  age  of  twenty-one  years. 

3.  An  alien  not  an  inhabitant  of  this  state;  or 

4.  Who  shall  have  been  convicted  of  an  infamous  crime,  or 

5.  Who,  on  proof,  is  found  by  the  surrogate  to  be  incompetent 
to  execute  the  duties  of  such  trust  by  reason  of  drunkenness,  dis- 
honesty, improvidence  or  want  of  understanding.  If  any  such  person 
be  named  as  the  sole  executor  in  a  will,  or  if  all  the  persons  named 
therein  as  executors  be  incompetent,  letters  of  administration,  with  the 
will  annexed  must  be  issued  as  in  the  case  of  all  the  executors 
renouncing,  A  surrogate,  in  his  discretion,  may  refuse  to  grant 
letters  testamentary  or  of  administration  to  a  person  unable  to  read 
and  write  the  English  language. 

Sect.  2613.  SUPPLEMENTARY  LETTERS;  EXECUTORS 
NOT  NAMED  IN  LETTERS  NOT  TO  ACT;  POWER  OF  EXEC- 
UTOR BEFORE  LETTERS  OF  ADMINISTRATION  WITH  THE 
WILL  ANNEXED.  If  the  disability  of  a  person  under  age,  or  an 
alien  named  as  executor  in  a  will,  be  removed  before  the  execution 
of  the  provisions  of  such  will  is  completed,  he  shall  be  entitled,  on 
application,  to  supplementary  letters  testamentary,  to  be  issued  in 
the  same  manner  as  the  original  letters,  and  authorized  to  join  in 
the  execution  of  the  will  with  the  persons  previously  appointed.     A 

47 


Fiduciary  Accounting 

person  named  in  a  will  as  executor,  and  not  named  as  such  in  the 
letters  testamentary  or  in  letters  of  administration  with  the  will 
annexed,  shall  be  deemed  to  be  superseded  thereby,  and  shall  have 
no  power  or  authority  whatever  as  such  executor  until  he  appears 
and  qualifies.  An  executor  named  in  a  will  has  no  power  to  dispose 
of  any  part  of  the  estate  of  the  testator  before  letters  testamentary 
are  granted,  except  to  pay  funeral  charges,  nor  to  interfere  with 
such  estate  in  any  manner  further  than  is  necessary  for  its  preserva- 
tion. Where  letters  of  administration  with  the  will  annexed  are 
granted,  the  will  of  the  deceased  shall  be  observed  and  performed ; 
and  the  administrators,  with  such  will,  have  the  rights  and  powers 
and  are  subject  to  the  same  duties  as  if  they  had  been  named  executors 
in  the  will. 

Sect.  2615.  WHO  TO  BE  CITED  THEREUPON.  The  follow- 
ing persons  must  be  cited  upon  a  petition,  presented  as  prescribed  in 
the  last  section: 

1.  If  the  will  relates  exclusively  to  real  property,  the  husband  or 
wife,  if  any,  and  all  the  heirs  of  the  testator. 

2.  If  the  will  relates  exclusively  to  personal  property,  the  hus- 
band or  wife,  if  any,  and  all  the  next  of  kin  of  the  testator. 

3.  If  the  will  relates  to  both  real  and  personal  property,  the 
husband  or  wife,  if  any,  and  all  the  heirs,  and  all  the  next  of  kin  of 
the  testator. 

4.  Any  person  designated  in  the  will  as  executor. 

Sect.  2617.  PERSONS  NOT  CITED  MAY  APPEAR.  Any  per- 
son, although  not  cited,  who  is  named  as  a  devisee  or  legatee  in  the  will 
propounded,  or  as  executor,  trustee,  devisee  or  legatee  in  any  other 
paper  purporting  to  be  a  will  of  the  decedent,  or  who  is  otherwise 
interested  in  sustaining  or  defeating  the  will,  may  appear,  and,  at 
his  election,  support  or  oppose  the  application.  A  person  so  appearing 
becomes  a  party  to  the  special  proceeding.  But  this  section  does  not 
affect  a  right  or  interest  of  such  a  person  unless  he  so  becomes  a 
party.  And  in  case  the  will  propounded  for  probate  is  opposed,  due 
and  timely  notice  of  the  hearing  of  the  objections  to  the  will  shall 
be  given,  in  such  manner  as  the  surrogate  shall  direct,  to  all  persons 
in  being,  who  would  take  any  interest  in  any  property  under  the 
provisions  of  the  will,  and  to  the  executor  or  executors,  trustee  or 
trustees  named  therein,  if  any,  who  have  not  appeared  in  the  pro- 
ceeding, and  any  decree  in  the  proceeding  shall  not  affect  the  right 
or  interest  of  any  person  unless  he  shall  be  notified. 

Sect.  2619.  ABSENT  WITNESSES.  The  death,  absence  from 
the  state,  lunacy,  or  other  incompetency  of  a  witness,  required  to  be 
examined  as  prescribed  in  this  or  the  last  section,  or  proof  that  such 
witness  cannot,  after  due  diligence,  be  found  within  the  state  or 
elsewhere,  must  be  shown  by  affidavit,  or  other  competent  evidence, 
to  the  satisfaction  of  the  surrogate,  before  dispensing  with  his  testi- 
mony. Where  a  witness,  being  within  the  state,  is  disabled  from 
attending,  by  reason  of  age,  sickness  or  infirmity,  his  disability  must 

48 


Fiduciary  Accounting 

be  shown  in  like  manner ;  and  in  that  case,  the  testimony  of  the  witness, 
where  it  is  required,  and  he  is  able  to  testify,  must  be  taken  in  the 
manner,  prescribed  by  law,  and  produced  before  the  surrogate  as  part 
of  the  proofs. 

Sect.  2620.  PROOF  OF  HANDWRITING.  If  all  the  subscribing 
witnesses  to  a  written  will  are,  or  if  a  subscribing  witness,  whose  testi- 
mony is  required,  is  dead,  or  incompetent,  by  reason  of  lunacy,  or 
otherwise,  to  testify,  or  unable  to  testify;  or  if  such  a  subscribing 
witness  is  absent  from  the  state;  or  if  such  a  subscribing  witness  has 
forgotten  the  occurrence,  or  testifies  against  the  execution  of  the 
will;  the  will  may  nevertheless  be  established,  upon  proof  of  the 
handwriting  of  the  testator,  and  of  the  subscribing  witnesses,  and  also 
of  such  other  circumstances,  as  would  be  sufficient  to  prove  the  will 
upon  the  trial  of  an  action.  Where  a  subscribing  witness  is  absent 
from  the  state,  upon  application  of  either  party,  the  surrogate  shall 
cause  the  testimony  of  such  witness  to  be  taken  by  commission,  when 
it  is  made  to  appear  that  by  due  diligence  such  testimony  may  be 
obtained.  Where  a  written  will  is  proved,  as  prescribed  in  this 
section,  it  must  be  filed  and  remain  in  the  surrogate's  office.  But 
when  it  shall  be  shown,  by  affidavit  or  otherwise,  to  the  satisfaction 
of  the  surrogate,  that  the  decedent  left  real  or  personal  property  in 
another  state  or  territory  of  the  United  States  or  in  a  foreign  country, 
and  that  the  laws  of  such  state,  territory  or  country  require  the  pro- 
duction of  the  original  will  before  the  provisions  thereof  become 
effective,  the  surrogate  may,  at  any  time  after  probate,  and  upon 
such  notice  to  the  parties  interested  in  the  estate  as  he  may  think 
proper,  cause  any  original  will  remaining  on  file  in  his  office  to  be 
sent  by  post  or  otherwise  to  any  court  which,  or  to  any  officer  of  such 
state,  territory  or  country  who,  under  the  laws  thereof,  is  empowered 
to  receive  the  same  for  probate,  or  deliver  such  will  to  any  person 
interested  in  the  probate  thereof  in  such  state,  territory  or  country, 
or  to  his  representative,  upon  such  terms  as  he  shall  think  proper 
for  the  protection  of  other  parties  interested  in  the  estate.  Where 
in  any  matter  before  the  surrogate  or  in  a  surrogate's  court  the 
testimony  of  any  witness  shall  be  taken  by  or  on  commission,  the 
same,  together  with  the  commission  on  which  it  is  taken,  shall  be 
duly  filed  in  the  office  of  the  surrogate,  but  need  not  be  recorded. 
The  testimony  or  other  proceeding  duly  taken  to  be  used  before  the 
surrogate  or  surrogate's  court,  by  a  stenographer,  shall  be  filed  and 
need  not  be  recorded. 

Sect.  2635.  WILLS  TO  BE  RETURNED  AFTER  PROBATE. 
Except  where  special  provision  is  otherwise  made  by  law,  or  where 
the  surrogate  sends  a  will  into  another  state  or  territory  or  into  a 
foreign  country,  or  delivers  it  to  a  party  in  interest,  as  provided  in 
section  two  thousand  six  hundred  and  twenty  of  this  act,  a  written 
will,  after  it  has  been  proved  and  recorded,  must  be  retained  by  the 
surrogate,  until  the  expiration  of  one  year  after  it  has  been  recorded, 
and,  if  a  petition  for  the  revocation  of  probate  thereof  is  then  filed, 

49 


Fiduciary  Accounting 

until  a  decree  is  made  thereupon.  It  must  then  be  returned,  upon 
demand,  to  the  person  who  delivered  it,  unless  he  is  dead,  or  a  lunatic, 
or  has  removed  from  the  state;  in  which  case,  it  may,  in  the  discretion 
of  the  surrogate,  be  delivered  to  any  person  named  therein  as  devisee, 
or  to  an  heir  or  assignee  of  a  devisee;  or,  if  it  relates  only  to  personal 
property,  to  the  executor,  or  administrator,  with  the  will  annexed,  or 
to  a  legatee. 

Sect.  2636.  WHEN  LETTERS  TESTAMENTARY  MAY  BE 
ISSUED;  OBJECTIONS.  Where  a  will,  which  is  admitted  to  pro- 
bate, names  one  or  more  persons  to  be  ex:ecutor  or  executors  thereof, 
upon  a  contingency,  the  surrogate  must  inquire  into  the  facts,  and,  if 
the  contingency  has  happened,  that  fact  must  be  recited  in  the  decree. 
Immediately  after  a  will  has  been  admitted  to  probate,  the  person  or 
persons  named  therein  as  executors,  who  are  competent  by  law  to 
serve,  and  who  appear  and  qualify,  are  entitled  to  letters  testamentary 
thereupon;  unless,  before  the  letters  are  granted,  a  creditor  of  the 
decedent,  or  a  person  interested  in  the  estate,  files  an  affidavit,  specify- 
ing his  demand,  or  how  he  is  interested,  and  either  setting  forth 
specifically  one  or  more  legal  objections  to  granting  the  letters  to  one 
or  more  of  the  executors,  or  stating  that  he  is  advised  and  believes 
that  there  are  such  objections,  and  that  he  intends  to  file  a  specific 
statement  of  the  same.  Where  such  an  affidavit  is  filed,  the  surrogate 
must  stay  the  granting  of  letters,  at  least  thirty  days,  or  until  the 
matter  is  sooner  disposed  of.  A  specification  or  statement  of  an 
objection,  made  as  prescribed  in  this  section,  must  be  verified  by 
the  oath  of  the  objector,  or  his  attorney,  to  the  effect  that  he  believes 
it  to  be  true. 

Sect.  2638.  WHEN  BOND  REQUIRED.  In  either  of  the  fol- 
lowing cases,  a  person  named  as  executor  in  a  will,  may  entitle  himself 
to  letters  testamentary  thereupon,  by  giving  a  bond  as  prescribed  by 
law,  although  an  objection  against  him  has  been  established  to  the 
satisfaction  of  the  surrogate: 

1.  Where  the  objection  is,  that  his  circumstances  are  such,  that 
they  do  not  afford  adequate  security  to  the  creditors,  or  persons 
interested  in  the  estate,  for  the  due  administration  of  the  estate. 

2.  Where  the  objection  is  that  he  is  not  a  resident  of  the  state; 
and  he  is  a  citizen  of  the  United  States. 

But  a  person  against  whom  there  is  no  objection,  except  that  of 
non-residence,  is  entitled  to  letters  testamentary,  without  giving  a 
bond,  if  he  has  an  office  within  the  state,  for  the  regular  transaction 
of  business  in  person;  and  the  will  contains  an  express  provision,  to 
the  effect  that  he  may  act  without  giving  security. 

Sect.  2639.  RENUNCIATION  BY  EXECUTOR;  RETRAC- 
TION. A  person,  named  as  executor  in  a  will,  may  renounce  the 
appointment  by  an  instrument  in  writing,  signed  by  him,  and  acknowl- 
edged or  proved,  and  certified,  in  like  manner  as  a  deed  to  be  recorded 
in  the  county,  or  attested  by  one  or  more  witnesses,  and  proved  to 
the  satisfaction  of  the  surrogate.    Such  a  renunciation  may  be  retracted 

50 


Fiduciary  Accounting 

by  a  like  instrument,  at  any  time  before  letters  testamentary,  or  letters 
of  administration  with  the  will  annexed,  have  been  issued  to  any  other 
person  in  his  place;  or,  after  they  have  been  so  issued,  if  they  have 
been  revoked,  or  the  person  to  whom  they  were  issued  has  died,  or 
become  a  lunatic,  and  there  is  no  other  acting  executor  or  administrator. 
Where  a  retraction  is  so  made,  letters  testamentary  may,  in  the  discre- 
tion of  the  surrogate,  be  issued  to  the  person  making  it.  An  instru- 
ment specified  in  this  section  must  be  filed  and  recorded  in  the 
surrogate's  office. 

Sect.  2642.  EXCLUSION  OF  EXECUTOR  FAILING  TO 
QUALIFY  OR  RENOUNCE.  If  a  person  named  as  executor,  in  a 
will  does  not  qualify  or  renounce  within  thirty  days  after  probate 
thereof;  or  if  a  person,  chosen  by  virtue  of  a  power  in  the  will,  does 
not  qualify  or  renounce  within  thirty  days  after  the  filing  of  the 
instrument  designating  him;  or,  in  either  case,  if  objections  are  filed,. 
and  the  executor  does  not  qualify  or  renounce  within  five  days  after 
they  are  determined  in  his  favor  or  in  a  case  specified  in  section 
twenty-six  hundred  and  thirty-eight  of  this  act,  within  five  days  after 
an  objection  has  been  established;  the  surrogate  must,  upon  the  appli- 
cation of  any  other  executor  or  any  creditor  or  person  interested 
in  the  estate,  make  an  order  requiring  him  to  qualify  within  a  time 
therein  specified ;  and  directing  that  in  default  of  so  doing,  he  be  deemed 
to  have  renounced  his  appointment.  Where  it  appears  by  affidavit 
or  other  written  proof  to  the  satisfaction  of  the  surrogate  that  such 
an  order  cannot,  with  due  diligence,  be  served  personally  within  the 
state,  upon  the  person  therein  named,  the  surrogate  may  prescribe  the 
manner  in  which  it  must  be  served,  which  may  be  by  publication. 
If  the  person  so  appointed  executor  does  not  qualify  within  the 
time  fixed,  or  within  such  further  time  as  the  surrogate  allows  for 
that  purpose,  an  order  must  be  made  and  recorded,  reciting  the 
facts,  and  declaring  that  he  has  renounced  his  appointment  as  executor. 
Such  an  order  may  be  revoked  by  the  surrogate  in  his  discretion, 
and  letters  testamentary  may  be  issued  to  the  person  so  failing  to 
renounce  or  qualify,  upon  his  application,  in  a  case  where  he  might 
have  retracted  an  express  renunciation,  as  prescribed  in  section  twenty- 
six  hundred  and  thirty-nine  of  this  act.  And  where  any  powers  to 
sell,  mortgage  or  lease  real  estate,  or  any  interest  therein,  are  given 
to  executors  as  such,  or  as  trustees,  or  as  executors  and  trustees,  and 
any  of  such  persons  named  as  executors  shall  neglect  to  qualify,  then 
all  sales,  mortgages  and  leases  under  said  powers  made  by  the  execu- 
tors who  shall  qualify  shall  be  equally  valid  as  if  the  other  executors 
or  trustees  had  joined  in  such  sale. 

Sect.  2643.  LETTERS  OF  ADMINISTRATION  WITH  WILL 
ANNEXED;  WHEN  AND  TO  WHOM.  If  no  person  is  named 
as  executor  in  the  will,  or  selected  by  virtue  of  a  power  contained 
therein;  or  if,  at  any  time,  by  reason  of  death,  incompetency  adjudged 
by  the  surrogate,  renunciation  in  either  of  the  methods  prescribed  in 
sections  2639  and  2642  of  this  act,  or  revocation  of  letters,  there  is  na 

51 


Fidu ciary  Accoun ting 

executor,  or  administrator  with  the  will  annexed,  qualified  to  act;  the 
surrogate  must,  upon  the  application  of  a  creditor  of  the  decedent,  or 
a  person  interested  in  the  estate  of  the  decedent,  or  having  a  lien 
upon  any  real  property  upon  which  the  decedent's  estate  has  a  lien,  and 
upon  such  notice  to  the  other  creditors  and  persons  interested  in  the 
estate,  as  the  surrogate  deems  proper,  issue  letters  of  administration 
with  the  will  annexed,  as  follows: 

1.  To  one  or  more  of  the  residuary  legatees,  who  are  qualified 
to  act  as  administrators.  If  any  one  of  such  legatees  who  would 
otherwise  be  so  entitled  is  a  minor,  administration  shall  be  granted 
to  his  guardian,  if  competent.  A  corporation  which  is  a  residuary 
legatee  shall  be  qualified  to  act  as  such  administrator,  although  not 
specially   authorized  by  its   charter  or  any  provision  of  law. 

2.  If  there  is  no  such  residuary  legatee  or  guardian,  or  none  who 
will  accept,  then  to  one  or  more  of  the  principal  or  specified  legatees 
so  qualified.  If  any  one  of  such  legatees  who  would  be  otherwise  so 
entitled  is  a  minor,  administration  shall  be  granted  to  his  guardian, 
if  competent. 

3.  If  there  is  no  such  legatee  or  guardian,  or  none  who  will 
accept,  then  to  the  husband  or  wife,  or  to  one  or  more  of  the  next 
of  kin,  or  to  one  or  more  of  the  heirs  or  devisees,  so  qualified. 

4.  If  there  is  no  qualified  person,  entitled  under  the  foregoing 
subdivisions,  who  will  accept,  then  to  one  or  more  of  the  creditors 
who  are  so  qualified,  except  that  in  the  counties  of  New  York  and 
Kings  the  public  administrator  shall  have  preference,  after  the  next 
of  kin,  over  the  creditors  and  all  other  persons. 

5.  If  there  is  no  qualified  creditor  who  will  accept,  then  to  any 
proper  person  designated  by  the  surrogate. 

Sect.  2645.  EXECUTOR  OR  ADMINISTRATOR  TO  QUAL- 
IFY. An  executor,  from  whom  a  bond  is  required,  as  prescribed 
in  this  article,  or  an  administrator  with  the  will  annexed,  must,  before 
letters  are  issued  to  him,  qualify  as  prescribed  by  law,  with  respect  to 
an  administrator  upon  the  estate  of  an  intestate;  and  the  provisions 
of  article  fourth  of  this  title,  with  respect  to  the  bond  to  be  given 
by  the  administrator  of  an  intestate,  apply  to  a  bond  given  pursuant 
to  this  section ;  except  that,  in  fixing  the  penalty  thereof,  the  surrogate 
must  take  into  consideration  the  value  of  the  real  property,  or  the 
proceeds  thereof,  which  may  come  to  the  hands  of  the  executor  or 
administrator  by  virtue  of  any  provision  contained  in  the  will. 

Sect.  2653a.  TO  ENABLE  THE  VALIDITY  OF  THE  PRO- 
BATE OF  A  WILL  TO  BE  CONCLUSIVELY  DETERMINED. 
Any  person  interested  as  devisee,  legatee,  or  otherwise,  in  a  will  or 
codicil  admitted  to  probate  in  this  state,  as  provided  by  the  code 
of  civil  procedure,  or  any  person  interested  as  heir-at-law,  next  of 
kin  or  otherwise,  in  any  estate,  any  portion  of  which  is  disposed  of, 
or  affected,  or  any  portion  of  which  is  attempted  to  be  disposed  of, 
or  affected,  by  a  will  or  codicil  admitted  to  probate  in  this  state,  as 
provided  by  the  code  of  civil  procedure,  within  two  years  prior  to  the 

52 


Fiduciary  Accounting 

passage  of  this  act,  or  any  heir-at-law  or  next  of  kin  of  the  testator 
making  such  will,  may  cause  the  validity  or  invalidity  of  the  probate 
thereof  to  be  determined  in  an  action  in  the  supreme  court  for  the 
county   in   which   such   probate    was   had.     All    the   devisees,    legatees 
and  heirs  of  the  testator    and  other  interested  persons,  including  the 
executor,  or  administrator,  must  be  parties  to  the  action.     Upon  the 
completion   of  service  of  all  parties,  the  plaintiff  shall   forthwith  file 
the   summons  and   complaint  in  the  office  of  the  clerk  of  the   court 
in  which  said  action  is  begun,  and  the  clerk  thereof  shall   forthwith 
certify  to  the  clerk  of  the  surrogate's  court  in  which  the  will  has  been 
admitted  to  probate,  the  fact  that  an  action  to  determine  the  validity 
of  the  probate  of  such  will  has  been  commenced,  and  on  receipt  of 
such  certificate  by  the  surrogate's  court,  the  surrogate  shall  forthwith 
transmit  to  the  court   in   which   such  action  has  been  begun  a  copy 
of  the  will,  testimony  and  all  papers  relating  thereto,  and  a  copy  of 
the    decree    of   probate,    attaching   the    same    together,    and    certifying 
the  same  under  the  seal  of  the  court.     The  issue  of  the  pleadings  in 
such  action  shall  be  confined  to  the  question  of  whether  the  writing 
produced  is  or  is  not  the  last  will  and  codicil  of  the  testator,  or  either. 
It  shall  be  tried  by  a  jury    and  a  verdict  thereon  shall  be     conclusive 
as  to  the  real  or  personal  property,  unless  a  new  trial  be  granted  or 
the  judgment  thereon  be  reversed  or  vacated.     On  the  trial  of  such 
issue   the   decree    of   the    surrogate   admitting   the    will   or   codicil   to 
probate  shall  be  prima  facie  evidence  of  the  due  attestation,  execution 
and  validity  of  such  will  or  codicil.    A  certified  copy  of  the  testimony 
of  such  of  the  witnesses  examined  upon  the  probate,  as  are  out  of  the 
jurisdiction   of  the   court,   dead,   or   have   become   incompetent    since 
the  probate,  shall  be  admitted  in  evidence  on  the  trial.     The  party 
sustaining  the  will  shall  be  entitled  to  open  and  close  the  evidence 
and  argument.    He  shall  offer  the  will  in  probate  and  rest.    The  other 
party   shall   then   offer   his   evidence.     The   party   sustaining  the   will 
shall  then  offer  his  other  evidence    and  rebutting  testimony  may  be 
offered  as  in  other  cases.    If  all  the  defendants  make  default  in  plead- 
ing, or  if  the  answers  served  in  said  action  raise  no  issues    then  the 
plaintiff  may  enter  judgment  as  provided   in  article  two  of  chapter 
eleven  of  the  code  of  civil  procedure    in  the  case  of  similar  defaults 
in  other  actions.     If  the  judgment  to  be  entered  in  an  action  brought 
under  this  section  is  that  the  writing  produced  is  the  last  will  and 
codicil,  or  either,  of  the  testator,   said  judgment   shall   also   provide 
that  all  parties  to  said  action,  and  all  persons  claiming  under  them 
subsequently   to  the   commencement   of  the   said   action,   be   enjoined 
from  bringing  or  maintaining  any  action  or  proceeding,  or  from  inter- 
posing or  maintaining  a  defense  in  any  action  or  proceeding  based 
upon  a  claim  that  such  writing  is  not  the  last  will  or  codicil,  or  either, 
of  the  testator.     Any  judgment  heretofore  entered  under  this  section 
determining  that   the   writing  produced   is   the   last   will   and   codicil, 
or  either,  of  the  testator,  shall,  upon  application  of  any  party  to  said 
action,  or  any  person  claiming  through  or  under  them,  and  upon  notice 

53 


Fiduciary  Accounting 

to  such  persons  as  the  court  at  special  term  shall  direct,  be  amended 
by  such  court  so  as  to  enjoin  all  parties  to  said  action,  and  all 
persons  claiming  under  the  parties  to  said  action  subsequently  to 
the  commencement  thereof,  from  bringing  or  maintaining  any  action  or 
proceeding  impeaching  the  validity  of  the  probate  of  the  said  will 
and  codicil,  or  either  of  them,  or  based  upon  a  claim  that  such  writing 
is  not  the  last  will  and  codicil,  or  either,  of  the  testator,  and  from 
setting  up  or  maintaining  such  impeachment  or  claim  by  way  of  answer 
in  any  action  or  proceeding.  When  final  judgment  shall  have  been 
entered  in  such  action,  a  copy  thereof  shall  be  certified  and  trans- 
mitted to  the  clerk  of  the  surrogate's  court  in  which  such  will  was 
admitted  to  probate.  The  action  brought  as  herein  provided  shall 
be  commenced  within  two  years  after  the  will  or  codicil  has  been 
admitted  to  probate,  but  persons  within  the  age  of  minority,  of  unsound 
mind,  imprisoned,  or  absent  from  the  state,  may  bring  such  action 
within   two   years   after   such   disability   has   been   removed. 

Sect.  2660.  WHO  ENTITLED  TO  LETTERS  OF  ADMINIS- 
TRATION. Administration  in  case  of  intestacy  must  be  granted 
to  the  relatives  of  the  deceased  entitled  to  succeed  to  his  personal 
property,  who  will  accept  the  same,  in  the  following  order : 

1.  To  the  surviving   husband   or   wife. 

2.  To  the  children. 

3.  To  the  father. 

4.  To  the  mother. 

5.  To  the  brothers. 

6.  To  the  sisters. 

7.  To  the  grandchildren. 

8.  To  any  other  next  of  kin  entitled  to  share  in  the  distribution 
of  the  estate. 

9.  To  an  executor  or  administrator  of  a  sole  legatee  named  in 
a  will,  whereby  the  whole  estate  is  devised  to  such  deceased  sole  legatee. 
If  a  person  entitled  is  a  minor,  administration  must  be  granted  to 
his  guardian,  if  competent,  in  preference  to  creditors  or  other  persons. 
If  no  relative,  or  guardian  of  a  minor  relative,  will  accept  the  same, 
the  letters  must  be  granted  to  the  creditors  of  the  deceased;  the 
creditor  first  applying,  if  otherwise  competent,  to  be  entitled  to  prefer- 
ence. If  no  creditor  applies,  the  letters  must  be  granted  to  any  other 
person  or  persons  legally  competent.  Letters  of  administration  shall 
also  be  granted  to  an  executor  or  administrator  of  a  deceased  person 
named  as  sole  legatee  in  a  will.  The  public  administrator  in  the 
city  of  New  York  has  preference  after  the  next  of  kin  and  after  an 
executor  or  administrator  of  a  sole  legatee  named  in  a  will  whereby 
the  whole  estate  is  devised  to  such  deceased  sole  legatee  over  creditors, 
and  all  other  persons.  In  other  counties,  the  county  treasurer  shall 
have  preference  next  after  creditors,  over  all  other  persons.  If  several 
persons  of  the  same  degree  of  kindred  to  the  intestate  are  entitled  to 
administration,  they  must  be  preferred  in  the  following  order:  First, 
men  to  women;  second,  relatives  of  the  whole  blood  to  those  of  the 

54 


Fiduciary  Accounting 

half  blood;  third,  unmarried  women  to  married  women.  If  there 
are  several  persons  equally  entitled  to  administration,  the  surrogate 
may  grant  letters  to  one  or  more  of  such  persons,  and  administration 
may  be  granted  to  one  or  more  competent  persons,  although  not 
entitled  to  same,  with  the  consent  of  the  person  entitled  to  be  joined 
with  such  person  or  persons;  which  consent  must  be  in  writing,  and 
filed  in  the  office  of  the  surrogate.  If,  in  an  action,  brought  or  about 
to  be  brought,  the  intestate,  if  living,  would  be  a  proper  party  thereto, 
any  party  to  such  action,  interested  in  the  subject  thereof,  may  apply 
to  the  surrogate's  court  for  the  granting  of  letters  of  administration 
to  himself,  or  some  other  qualified  person,  and  upon  the  jurisdic- 
tional facts  being  satisfactorily  shown,  and  no  relative,  or  guardian 
of  a  minor  relative,  and  no  creditor,  county  treasurer  or  public  admin- 
istrator consenting  to  such  administration,  some  legally  competent 
person  must  be  appointed  administrator. 

Sect.  2661.  PERSONS  INCOMPETENT  TO  RECEIVE  LET- 
TERS. Letters  of  administration  shall  not  be  granted  to  a  person 
convicted  of  an  infamous  crime,  nor  to  any  one  incapable  by  law 
of  making  a  contract,  nor  to  a  person  not  a  citizen  of  the  United 
States,  unless  he  is  a  resident  of  the  state,  nor  to  a  person  under 
twenty-one  years  of  age,  or  who  is  adjudged  incompetent  by  the 
surrogate  to  execute  the  duties  of  such  trust  by  reason  of  drunkenness, 
improvidence     or    want    of   understanding. 

Sect.  2664.  ADMINISTRATOR'S  BOND.  A  person  appointed 
administrator,  before  letters  are  issued  to  him,  must  file  his  official 
oath,  execute  to  the  people  of  the  state,  and  file  with  the  surrogate,  the 
joint  and  several  bond  of  himself  and  two  or  more  sureties,  in  a 
penalty  fixed  by  the  surrogate,  not  less  than  twice  the  value  of  the 
personal  property  of  which  the  decedent  died  possessed  and  of  the 
probable  amount  to  be  recovered  by  reason  of  any  right  of  action, 
granted  to  an  executor  or  administrator,  by  special  provision  of  law. 
The  sum  to  be  fixed  as  the  amount  of  the  penalty  must  be  ascertained 
by  the  surrogate,  by  the  examination  on  oath  of  the  applicant  or 
any  other  person,  or  otherwise,  as  the  surrogate  thinks  proper.  The 
bond  must  be  conditioned  that  the  administrator  will  faithfully  dis- 
charge the  trust  reposed  in  him  as  such  and  obey  all  lawful  decrees 
and  orders  of  the  surrogate's  court  touching  the  administration  of 
the  estate  committed  to  him.  But  where  a  right  of  action  is  granted 
to  an  executor  or  administrator  from  a  compromise  of  the  action, 
and  it  appears  to  be  impracticable  to  give  a  bond  sufficient  to  cover  the 
probable  amount  to  be  recovered,  the  surrogate  may,  in  his  discretion, 
accept  modified  security,  and  issue  letters  limited  to  the  prosecution 
of  such  action,  but  restraining  the  executor  or  administrator  from 
a  compromise  of  the  action,  and  the  enforcement  of  any  judgment 
recovered  therein,  until  the  further  order  of  the  surrogate  on  addi- 
tional further  satisfactory  security.  In  cases  where  all  the  next  of 
kin  to  the  intestate  consent,  the  penalty  of  the  bond  need  not  exceed 
double  the  amount  of  the  claims  of  the  creditors,  against  the  estate, 

55 


Fiduciary  Accounting 

presented  to  the  surrogate,  pursuant  to  a  notice  to  be  published  twice 
a  week  for  four  weeks  in  the  official  state  paper,  and  in  two  newspapers 
published  in  the  city  of  New  York,  and  once  a  week  for  four  weeks, 
in  two  newspapers  published  in  the  county  where  the  intestate  usually 
resided,  and  in  the  county  where  he  died,  reciting  an  intention  to 
apply  for  letters  under  this  provision,  and  notifying  creditors  to 
present  their  claims  to  the  surrogate  on  or  before  a  day  to  be  fixed 
in  such  notice,  which  shall  be  at  least  thirty  days  after  the  first 
publication  thereof;  but  no  bond  so  given  shall  be  for  less  than  five 
thousand  dollars;  and  such  bond  may  be  increased  by  order  of  the 
surrogate  for  cause  shown.  Pending  such  application,  no  temporary 
administrator  shall  be  appointed,  except  on  petition  of  such  next  of  kin. 
Sect.  2670.  WHEN  AND  HOW  TEMPORARY  ADMINISTRA-. 
TORS  MAY  BE  APPOINTED.  On  the  application  of  a  creditor,  or 
a  person  interested  in  the  estate,  the  surrogate  may,  in  his  discretion, 
issue  to  one  or  more  persons,  competent  and  qualified  to  serve  as 
executors,  letters  of  temporary  administration,  in  either  of  the  follow- 
ing cases : 

1.  When  for  any  cause,  delay  necessarily  occurs  in  the  granting 
of  letters  testamentary  or  letters  of  administration,  or  in  probating 
a  will. 

2.  Where  a  person,  of  whose  estate  the  surrogate  would  have 
jurisdiction,  if  he  was  shown  to  be  dead,  disappears  or  is  missing,  so 
that,  after  diligent  search,  his  abode  cannot  be  ascertained,  and  under 
circumstances  which  afford  reasonable  ground  to  believe  either  that  he 
is  dead,  or  that  he  has  become  a  lunatic,  or  that  he  has  been  secreted, 
confined,  or  otherwise  unlawfully  made  away  with;  and  the  appoint- 
ment of  a  temporary  administrator  is  necessary  for  the  protection  of 
his  property,  and  the  rights  of  creditors  or  of  those  who  will  be 
interested  in  the  estate,  if  it  is  found  that  he  is  dead.  An  appointment 
of  a  temporary  administrator,  in  a  case  specified  in  subdivision  first 
must  be  made  by  an  order.  At  least  ten  days'  notice  of  the  application 
for  such  an  order  must  be  given  to  each  party  to  the  proceeding  who 
has  appeared,  unless  the  surrogate  is  satisfied  by  proof  that  the  safety 
of  the  estate  requires  the  notice  to  be  shortened,  in  which  case  he 
may  shorten  the  time  of  service  to  not  less  than  two  days.  Applica- 
tion for  such  an  appointment,  in  a  case  specified  in  subdivision  second, 
must  be  made  by  petition,  in  like  manner  as  where  an  application  is 
made  for  administration  in  case  of  intestacy;  and  the  proceedings 
are  the  same  as  prescribed  in  article  fourth  of  this  title,  relating  to 
such  last  mentioned  application.  Such  an  application  for  the  appoint- 
ment of  a  temporary  administrator  may  also  be  made,  with  like  effect, 
and  in  like  manner,  as  if  made  by  a  creditor,  by  the  county  treasurer 
of  the  county  where  the  person,  whose  estate  is  in  question,  last 
resided;  or,  if  he  was  not  a  resident  of  the  state,  of  the  county  where 
any  of  his  property,  real  or  personal,  is  situated.  A  temporary  admin- 
istrator must  qualify,  as  prescribed  in  article  fourth  of  this  title,  with 
respect   to   an   administrator-in-chief. 

56 


Fiduciary  Accounting 

Sect.  2672.  GENERAL  POWERS  OF  TEMPORARY  ADMIN- 
ISTRATOR- A  temporary  administrator,  appointed  as  prescribed  in 
this  article,  has  authority  to  take  into  his  possession  personal  property; 
to  secure  and  preserve  it;  and  to  collect  choses  in  action;  and,  for 
either  of  these  purposes,  he  may  maintain  any  action  or  special  pro- 
ceeding. An  action  may  be  maintained  against  him,  by  leave  of  the 
surrogate,  upon  a  debt  of  the  decedent,  or  of  the  absentee  whom  he 
represents,  in  like  manner,  and  with  like  effect  as  if  he  was  an  admin- 
istrator-in-chief, llie  surrogate  may,  by  an  order  made  upon  at 
least  ten  days'  notice  to  all  the  parties  who  have  appeared  in  the 
special  proceeding,  authorize  the  temporary  administrator  to  sell,  after 
appraisal,  such  personal  property,  specifying  it,  of  the  decedent,  or  of 
the  absentee  whom  he  represents,  as  it  appears  to  be  necessary  to  sell, 
for  the  benefit  of  the  estate;  or,  if  it  appears  that  the  safety  of  the 
estate  requires  the  notice  to  be  shortened,  the  surrogate  may  shorten 
the  notice  to  not  less  than  two  days.  The  surrogate  may,  also,  by 
order,  authorize  him  to  pay  funeral  expenses,  or  any  expenses  of  the 
administration  of  his  trust,  or  stenographer's  or  referee's  fees  on  con- 
test of  a  will  or  administration;  and  he  may  also  direct  the  payment 
of  a  legacy  or  other  pecuniary  provision  under  a  will  or  a  distributive 
share  or  just  proportionate  part  thereof,  according  to  section  two 
thousand  seven  hundred  and  nineteen  of  this  act  as  though  he  were 
an  executor  or  administrator. 

Sect.  2673.  WHEN  TEMPORARY  ADMINISTRATOR  AD- 
VERTISE FOR  CLAIMS.  Aftr  six  months  have  elapsed,  since 
letters  were  issued  to  a  temporary  administrator,  appointed  upon  the 
estate,  of  either  a  decedent  or  an  absentee,  he  has  the  same  power, 
as  an  administrator-in-chfef,  to  publish  a  notice  requiring  creditors  of 
the  decedent  or  absentee,  to  exhibit  their  demands  to  him.  The  pub- 
lication thereof  has  the  same  effect,  with  respect  to  the  temporary 
administrator,  and  also  an  executor  or  administrator  subsequently 
appointed  upon  the  estate,  as  if  the  temporary  administrator  was  the 
executor  or  an  administrator-in-chief,  and  the  person  to  whom  the 
subsequent  letters  are  issued  was  his  successor. 

Sect.  2674.  WHEN  TEMPORARY  ADMINISTRATOR  AU- 
THORIZED TO  PAY  DEBTS.  After  a  year  has  elapsed,  since  letters 
were  issued  to  a  temporary  administrator,  appointed  upon  the  estate, 
of  either  a  decedent  or  an  absentee,  the  surrogate  may,  upon  the 
application  of  the  temporary  administrator,  and  upon  proof,  to  his 
satisfaction,  that  the  assets  exceed  the  debts,  make  an  order,  permitting 
the  applicant  to  pay  the  whole  or  any  part  of  a  debt,  due  to  a  creditor 
of  the  decedent  or  absentee;  or,  upon  the  petition  of  such  a  creditor, 
he  may  issue  a  citation  to  the  temporary  administrator,  requiring  him 
to  show  cause  why  he  should  not  pay  the  petitioner's  debt.  When  such 
a  petition  is  presented  the  proceedings  are,  in  all  respects,  the  same 
as  where  a  creditor  presents  a  petition,  praying  for  a  decree  directing 
an  executor  or  administrator  to  pay  his  debt,  as  prescribed  in  article 
first  of  title  fourth  of  this  chapter. 

57 


Fiduciary  Accounting 

Sect.  2675.  ID.;  AS  TO  REAL  PROPERTY.  When  a  tem- 
porary administrator  is  appointed  and  a  proceeding  is  pending  for 
the  probate  of  a  will  of  real  property,  or  there  is  a  delay  in  the  granting 
of  letters  testamentary  or  administration  on  such  a  will  or  in  the 
qualification  of  a  trustee  named  therein,  the  order  appointing  him 
may  confer  upon  him  the  authority  to  take  possession  of  real  property, 
in  the  same  or  another  county,  which  is  affected  by  the  will,  and  to 
receive  the  rents  and  profits  thereof.  The  surrogate  may,  by  an  order, 
confer  upon  him  authority  to  lease  any  or  all  of  the  real  property,  for 
a  term  not  exceeding  one  year;  or  to  do  any  other  act  with  respect 
thereto,  except  to  sell  it,  which  is,  in  the  surrogate's  opinion,  necessary 
for  the  execution  of  the  will,  or  the  preservation  or  benefit  of  the  real 
property.  For  either  of  these  purposes,  he  may  maintain  or  defend 
any  action  or  special  proceeding. 

Sect.  2676.  POWERS  OF  TEMPORARY  ADMINISTRATOR 
OF  ABSENTEE.  A  temporary  administrator,  appointed  upon  the 
estate  of  an  absentee,  has  all  the  powers  and  authority  enumerated 
in  the  last  section,  with  respect  to  the  real  property  of  the  absentee. 
His  acts,  done  in  pursuance  of  that  authority,  bind  the  absentee,  if 
he  is  living,  or  his  heir  or  devisee,  if  he  is  dead,  in  the  same  manner 
as  the  acts  of  an  executor  or  administrator  bind  his  successor. 

Sect.  2677.  TEMPORARY  ADMINISTRATOR  OF  ABSENTEE 
MAY  PROVIDE  FOR  HIS  FAMILY.  Upon  proof,  satisfactory  to 
the  surrogate,  that  the  wife  or  any  infant  child  of  an  absentee,  upon 
whose  estate  a  temporary  administrator  has  been  appointed,  is  in 
such  circumstances,  as  to  require  provision  to  be  made  out  of  the 
estate  for  his  or  her  maintenance,  clothing,  or  education,  the  surrogate 
may  make  an  order,  directing  the  temporary  administrator  to  make 
such  provision  therefor,  as  the  surrogate  deems  proper,  out  of  any 
personal  property  in  his  hands,  not  needed  for  the  payment  of  debts. 

Sect.  2678.  TEMPORARY  ADMINISTRATOR  TO  DEPOSIT 
MONEY.  A  temporary  administrator,  appointed  as  prescribed  in 
this  article,  must,  within  ten  days  after  any  money  belonging  to  the 
estate  comes  into  his  hands,  deposit  it  as  prescribed  in  this  section. 
Where  he  was  appointed  by  the  surrogate's  court  of  any  county  except 
New  York,  it  must  be  deposited  with  a  person,  with  a  bank  or  in  a 
domestic  incorporated  trust  company,  designated  by  the  surrogate; 
but  a  natural  person  so  designated  as  depositary  must  first  file  in  the 
surrogate's  office  a  bond  to  the  surrogate  in  a  penalty  fixed  by  him, 
executed  by  the  depositary  and  two  sureties,  and  conditioned  to  render 
a  faithful  account  and  pay  over  all  money  received  by  him  upon  the 
direction  of  any  court  of  competent  jurisdiction.  Where  the  tempo- 
rary administrator  was  appointed  by  the  surrogate  of  the  county  of 
New  York,  the  money  must  be  deposited  in  a  domestic  incorporated 
trust  company,  having  its  principal  office  or  place  of  business  in  the 
city  of  New  York,  and  either  specially  approved  by  the  surrogate 
or  designated  in  the  general  rules  of  practice  as  a  depositary  of  funds 
paid  into  court. 

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Fiduciary  Accounting 

Sect.  2679.  PROCEEDINGS  TO  COMPEL  DEPOSIT.  If  a 
temporary  administrator  neglects  to  make  a  deposit,  as  prescribed  in 
the  last  section,  within  the  time  therein  limited,  the  surrogate  must, 
upon  the  application  of  a  creditor  or  person  interested  in  the  estate, 
accompanied  with  satisfactory  proof  of  the  neglect,  make  an  order, 
directing  him  to  do  so  forthwith,  or  to  show  cause  why  a  warrant 
of  attachment  should  not  issue  against  him.  In  the  county  of  New 
York,  the  order  must  be  made  returnable  three  days  after  issuing  it; 
and  it  must  be  served  upon  the  temporary  administrator,  at  least  two 
days  before  the  return  day  thereof,  either  personally  or  by  leaving  a 
copy  thereof  within  the  state,  at  his  dwelling  place,  or  his  office  for 
the  regular  transaction  of  business  in  person;  or,  if  it  cannot  be 
served  in  either  of  those  methods,  by  serving  it  in  such  other  manner, 
as  the  surrogate  directs.  In  any  other  county,  it  must  be  made  return- 
able within  a  reasonable  time,  not  exceeding  fifteen  days  after  issuing 
it;  and  it  must  be  served,  in  like  manner,  at  least  ten  days  before  the 
return  day  thereof. 

Sect.  2680.  HOW  MONEY  DEPOSITED  MAY  BE  WITH- 
DRAWN. Money  deposited  by  a  temporary  administrator,  as  pre- 
scribed in  this  article,  cannot  be  withdrawn,  except  upon  the  order 
of  the  surrogate,  a  certified  copy  of  which  must  be  presented  to  the 
depositary.  Such  an  order  may  be  made  upon  two  days'  notice  of  the 
application  therefor,  given  to  all  the  parties  to  the  special  proceeding, 
in  which  the  temporary  administrator  was  appointed,  who  appeared 
therein ;  but  not  otherwise. 

Sect.  2685.  REVOCATION  OF  LETTERS  FOR  ACTS  OF 
EXECUTOR  OR  ADMINISTRATOR,  OR  OTHER  CAUSES.  In 
either  of  the  following  cases,  a  creditor,  or  person  interested  in  the 
estate  of  a  decedent,  may  present  to  the  surrogate's  court,  from  which 
letters  were  issued  to  an  executor  or  administrator,  a  written  petition, 
duly  verified,  praying  for  a  decree  revoking  those  letters;  and  that 
the  executor  or  administrator  may  be  cited  to  show  cause  why  a 
decree  should  not  be  made  accordingly: 

1.  Where  the  executor  or  administrator  was,  when  letters  were 
issued  to  him,  or  has  since  become,  incompetent,  or  disqualified  by 
law  to  act  as  such;  and  the  grounds  of  the  objection  did  not  exist,  or 
the  objection  was  not  taken  by  the  petitioner,  or  a  person  whom  he 
represents,  upon  the  hearing  of  the  application  for  letters. 

2.  Where,  by  reason  of  his  having  wasted  or  improperly  applied 
the  money  or  other  assets  in  his  hands,  or  invested  money  in  securi- 
ties unauthorized  by  law,  or  otherwise  improvidently  managed  or 
injured  the  property  committed  to  his  charge;  or  by  reason  of  other 
misconduct  in  the  execution  of  his  office,  or  dishonesty,  drunkenness, 
improvidence,  or  want  of  understanding;  he  is  unfit  for  the  due 
execution  of  his  office. 

3.  Where  he  has  wilfully  refused,  or,  without  good  cause,  neglected 
to  obey  any  lawful  direction  of  the  surrogate,  contained  in  a  decree  or 
order ;  or  any  provision  of  law,  relating  to  the  discharge  of  his  duty. 

59 


Fiduciary  Accounting 

4.  Where  the  grant  of  his  letters  was  obtained  by  a  false  sugges- 
tion of  a  material   fact. 

5.  In  the  case  of  an  executor,  where  his  circumstances  are  such, 
that  they  do  not  afford  adequate  security  to  the  creditors  or  persons 
interested,  for  the  due  administration  of  the  estate. 

6.  In  the  case  of  an  executor,  where  he  has  removed  or  is  about 
to  remove  from  the  state,  and  the  case  is  not  one,  where  a  non-resident 
executor  would  be  entitled  to  letters  without  giving  a  bond. 

7.  In  the  case  of  an  executor,  where,  by  the  terms  of  the  will, 
his  office  was  to  cease  upon  a  contingency,  which  has  happened. 

8.  In  the  case  of  a  temporary  administrator,  appointed  upon  the 
estate  of  an  absentee,  where  it  is  shown  that  the  absentee  has  returned ; 
or  that  he  is  living,  and  capable  of  returning  and  resuming  the  man- 
agement of  his  affairs;  or  that  an  executor  or  administrator-in-chief, 
has  been  appointed  upon  his  estate;  or  that  a  committee  of  his  prop- 
erty has  been  appointed  by  a  competent  court  of  the  state. 

Sect.  2689.  EXECUTOR  OR  ADMINISTRATOR  MAY  AP- 
PLY FOR  REVOCATION  AND  ACCOUNTING.  An  executor 
or  administrator  may,  at  any  time,  present  to  the  surrogate's  court  a 
written  petition,  duly  verified,  praying  that  his  account  may  be  judi- 
cially settled ;  that  a  decree  may  thereupon  be  made,  revoking  his 
letters,  and  discharging  him  accordingly ;  and  that  the  same  persons 
may  be  cited  to  show  cause,  why  such  a  decree  should  not  be  made, 
who  must  be  cited  upon  a  petition  for  a  judicial  settlement  of  his 
account,  as  prescribed  in  article  second  of  title  fourth  of  this  chapter. 
The  petition  must  set  forth  the  facts  upon  which  the  application  is 
founded ;  and  it  must,  in  all  other  respects,  conform  to  a  petition  pray- 
ing for  a  judicial  settlement  of  the  account  of  an  executor  or  admin- 
istrator. The  surrogate  may,  in  his  discretion,  entertain,  or  decline  to 
entertain    the  application. 

Sect.  2690.  PROCEEDINGS  ON  EXECUTOR'S  OR  ADMIN- 
ISTRATOR'S APPLICATION;  ACCOUNTING.  If  the  surrogate 
entertains  an  application,  made  as  prescribed  in  the  last  section,  the 
proceedings  thereupon  must  be,  in  all  respects,  the  same,  as  upon 
a  petition  for  a  judicial  settlement  of  the  petitioner's  account;  except 
that,  upon  the  hearing,  the  surrogate  must  first  determine  whether 
sufficient  reasons  exist  for  granting  the  prayer  of  the  petition.  If  he 
determines  that  they  exist,  he  must  make  an  order  accordingly,  and 
allowing  the  petitioner  to  account,  for  the  purpose  of  being  discharged. 
Upon  his  fully  accounting,  and  paying  over  all  money  which  is  found 
to  be  due  from  him  to  the  estate,  and  delivering  over  all  books,  papers 
and  other  property  of  the  estate  in  his  hands,  either  into  the  surrogate's 
court,  or  in  such  a  manner  as  the  surrogate  directs,  a  decree  may 
be  made,  revoking  the  petitioner's  letters,  and  discharging  him  accord- 
ingly. 

Sect.  2692.  WHEN  REMAINING  EXECUTORS  OR  ADMIN- 
ISTRATORS ACT;  WHEN  SUCCESSORS  APPOINTED.  \Vhere 
one  of  two  or  more  executors  or  administrators  dies,   or  becomes  a 

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Fiduciary  Accounting 

lunatic,  or  is  convicted  of  an  infamous  offense,  or  becomes  otherwise 
incapable  of  discharging  the  trust  reposed  in  him;  or  where  letters 
are  revoked  with  respect  to  one  of  them,  a  successor  to  the  person 
whose  letters  are  revoked,  shall  not  be  appointed,  except  where  such 
an  appointment  is  necessary,  in  order  to  comply  with  the  express 
terms  of  a  will;  but  the  others  may  proceed  and  complete  the  admin- 
istration of  the  estate,  pursuant  to  the  letters,  and  may  continue  any 
action  or  special  proceeding,  brought  by  or  against  all. 

Sect.  2693.  WHEN  SUCCESSOR  MUST  BE  APPOINTED. 
When  all  the  executors  or  all  the  administrators,  to  whom  letters  have 
been  issued,  die,  or  become  incapable,  as  prescribed  in  section  two 
thousand  six  hundred  and  ninety-two,  or  the  letters  are  revoked  as 
to  all  of  them,  the  surrogate  must  grant  letters  of  administration  to 
one  or  more  persons  as  their  successors,  in  like  manner  as  if  the  former 
letters  had  not  been  issued;  and  the  proceedings  to  procure  the  grant 
of  such  letters  are  the  same,  and  the  same  security  shall  be  required, 
as  in  a  case  of  intestacy,  except  that  the  surrogate  may,  in  his  discre- 
tion, in  case  where  the  estate  has  been  partially  administered  upon 
by  the  former  representative  or  representatives,  fix  as  the  penalty  of 
the  bond  to  be  given  by  such  successor  or  successors,  a  sum  not  less 
than  twice  the  value  of  the  assets  of  the  estate  remaining  unadmin- 
istered. 

Sect.  2695.  ANCILLARY  LETTERS  UPON  FOREIGN  PRO- 
BATE. Where  a  will  of  personal  property  made  by  a  person  who 
resided  without  the  state  at  the  time  of  the  execution  thereof,  or  at 
the  time  of  his  death,  has  been  admitted  to  probate  within  the  foreign 
country,  or  within  the  state  or  territory  of  the  United  States,  where 
it  was  executed,  or  where  the  testator  resided  at  the  time  of  his  death, 
the  surrogate's  court  having  jurisdiction  of  the  estate  must,  upon 
an  application  made  as  prescribed  in  this  article,  accompanied  by  a 
copy  of  the  will,  and  of  the  foreign  letters,  if  any  have  been  issued, 
authenticated  as  prescribed  in  section  forty-five  of  the  decedent  estate 
law,  record  the  will  and  the  foreign  letters,  and  issue  thereupon  ancil- 
lary letters  testamentary,  or  ancillary  letters  of  administration,  with 
the  will  annexed,  as  the  case  requires. 

Sect.  2697.  TO  WHOM  ANCILLARY  LETTERS  GRANTED 
Where  the  will  specially  appoints  one  or  more  persons  as  the  executor* 
thereof,  with  respect  to  personal  property  situated  within  the  state, 
the  ancillary  letters  testamentary  must  be  directed  to  the  persons  so 
appointed,  or  to  those  who  are  competent  to  act  and  qualify.  If  all 
are  incompetent,  or  fail  to  qualify,  or  in  a  case  where  such  an  appoint- 
ment is  not  made,  ancillary  letters  testamentary,  or  ancillary  letters  of 
administration,  issued  as  prescribed  in  this  article,  must  be  directed 
to  the  person  named  in  the  foreign  letters  or  to  the  person  otherwise 
entitled  to  the  possession  of  the  personal  property  of  the  decedent, 
unless  another  person  applies  therefor,  and  files  with  his  petition,  an 
instrument,  executed  by  the  foreign  executor  or  administrator,  or  person 
otherwise  entitled  as  aforesaid;  or,  if  there  are  two  or  more,  by  all 

61 


Fiduciary  Accountitig 

who  have  qualified  and  are  acting;  and  also  acknowledged  or  proved 
and  certified  in  like  manner  as  a  deed  to  be  recorded  in  the  county, 
authorizing  the  petitioner  to  receive  such  ancillary  letters,  in  which 
case  the  surrogate  must,  if  the  petitioner  is  a  fit  and  competent  person, 
issue  such  letters  directed  to  him.  Where  two  or  more  persons  are 
named  in  the  foreign  letters,  or  in  an  instrument  executed  as  pre- 
scribed in  this  section,  the  ancillary  letters  may  be  directed  to  either 
or  any  of  them,  without  naming  the  others,  if  the  others  fail  to  qualify, 
or  if,  for  good  cause  shown  to  the  surrogate's  satisfaction,  the  decree 
so  directs. 

Sect.  2702.  POWERS  AND  DUTIES  OF  ANCILLARY  EXEC- 
UTORS AND  ADMINISTRATORS.  The  provisions  of  this  chapter, 
relating  to  the  rights,  powers,  duties  and  liabilities  of  an  executor  or 
administrator,  apply  to  a  person  to  whom  ancillary  letters  are  granted, 
as  prescribed  in  this  article ;  except  those  contained  in  title  fifth 
thereof;  or  where  special  provision  is  otherwise  made  in  this  article; 
or  where  a  contrary  intent  is  expressed  in,  or  plainly  to  be  inferred 
from,  the  context. 

Sect.  2707.  PROCEEDINGS  TO  DISCOVER  PROPERTY 
WITHHELD.  An  executor  or  administrator  may  present  to  the 
surrogate's  court,  from  which  letters  were  issued  to  him,  a  written 
petition  duly  verified  setting  forth,  on  knowledge  or  information 
and  belief,  any  facts  tending  to  show  that  money  or  other  personal 
property  which  should  be  delivered  to  the  petitioner,  or  included  in  an 
inventory  or  appraisal,  is  in  the  possession,  under  the  control  or 
within  the  knowledge  or  information  of  a  person  who  withholds  the 
same  from  him;  or  who  refuses  to  impart  knowledge  or  information 
he  may  have  concerning  the  same,  or  to  disclose  any  other  fact  which 
will  aid  such  executor  or  administrator  in  making  discovery  of  such 
property,  so  that  it  cannot  be  inventoried  or  appraised;  and  praying 
an  inquiry  respecting  it,  and  that  the  person  complained  of  may  be 
cited  to  attend  the  inquiry  and  be  examined  accordingly,  and  to 
deliver  the  property  if  in  his  control.  The  petition  may  be  accom- 
panied by  an  affidavit  or  other  evidence,  written  or  oral,  tending  to 
support  the  allegations  thereof.  If  the  surrogate  is  satisfied,  on  the 
papers  so  presented,  that  there  are  reasonable  grounds  for  the  inquiry, 
he  must  issue  a  citation  accordingly;  which  may  be  made  returnabla 
forthwith,  or  at  a  future  time  fixed  by  the  surrogate,  and  may  be 
served  at  any  time  before  the  hearing.  Where  the  person,  or  any  of 
the  persons,  to  be  cited,  does  not  reside,  or  is  not  within  the  county 
of  the  surrogate,  the  citation,  in  the  surrogate's  discretion,  may  require 
him  to  appear  at  a  specified  time  and  place  within  the  county  where 
he  resides   or  is  served    before  the  surrogate  of  that  county. 

Sect.  271  i.  APPOINTMENT  OE  APPRAISERS  AND  AP- 
PRAISAL. On  the  application  of  an  executor  or  administrator,  the 
surrogate,  by  writing,  must  appoint  two  disinterested  appraisers,  as 
often  as  may  be  necessary,  to  appraise  the  personal  property  of  a 
deceased  person,  who  shall  be  entitled  to  receive  a  reasonable  compen- 

62 


Fiduciary  Accounting 

sation  for  their  services,  to  be  allowed  by  the  surrogate,  not  exceeding 
for  each  the  sum  of  five  dollars  for  each  day  actually  employed  in 
making  appraisement,  in  addition  to  expenses  actually  and  necessarily 
incurred.  The  number  of  days'  service  rendered,  and  the  amount  of 
such  expenses,  must  be  verified  by  the  affidavit  of  the  appraiser,  deliv- 
ered to  the  executor  or  administrator,  and  adjusted  by  the  surrogate 
before  payment  of  the  fees.  The  executors  and  administrators,  v^ithin 
a  reasonable  time  after  qualifying,  and  after  giving  notice  of  at  least 
five  days  to  the  legatees,  and  next  of  kin,  residing  in  the  county  where 
the  property  is  situated,  and  posting  a  notice  in  three  of  the  most 
public  places  of  the  town,  specifying  the  time  and  place  at  which 
the  appraisement  will  be  made,  must  make  a  true  and  perfect  inven- 
tory of  all  the  personal  property  of  the  testator  or  intestate;  and  if 
in  different  and  distant  places,  two  or  more  such  inventories  as  may 
be  necessary.  Before  making  the  appraisement,  the  appraisers  must  take 
and  subscribe  an  oath,  to  be  inserted  in  the  inventory,  that  they  will 
truly,  honestly  and  impartially  appraise  the  personal  property  exhibited 
to  them,  according  to  the  best  of  their  knowledge  and  ability.  They 
must,  in  the  presence  of  such  of  the  parties  interested  as  attend,  esti- 
mate and  appraise  the  property  exhibited  to  them,  and  set  down  each 
article  separately  with  the  value  thereof  in  dollars  and  cents,  distinctly, 
in  figures  opposite  to  the  articles  respectively.  Service  of  the  notice 
above  mentioned  may  be  either  personal  or  in  the  manner  prescribed 
by  section  797,  subdivision  one  and  section  798  of  this  act. 

Sect.  2712.  WHAT  SHALL  BE  DEEMED  ASSETS.  The  fol- 
lowing shall  be  deemed  assets  and  go  to  the  executors  or  adminis- 
trators to  be  applied  and  distributed  as  part  of  the  personal  property 
of  the  testator  or  intestate,  and  be  included  in  the  inventory : 

1.  Leases  for  years;  lands  held  by  the  deceased  from  year  to 
year;  and  estates  held  by  him  for  the  life  of  another  person. 

2.  The  interest  remaining  in  him,  at  the  time  of  his  death,  in 
a  term  of  years  after  the  expiration  of  any  estate  for  years  therein, 
granted  by  him  or  any  other  person. 

3.  The  interest  in  lands  devised  to  an  executor  for  a  term  of 
years  for  the  payment  of  debts. 

4.  Things  annexed  to  the  freehold,  or  to  any  building  for  the 
purpose  of  trade  or  manufacture,  and  not  fixed  into  the  wall  of  a 
house  so  as  to  be  essential  to  its  support. 

5.  The  crops  growing  on  the  land  of  the  deceased  at  the  time  of 
his  death. 

6.  Every  kind  of  produce  raised  annually  by  labor  and  cultivation, 
except  growing  grass  and  fruit  ungathered. 

7.  Rent  reserved  to  the  deceased  which  had  accrued  at  the  time  of 
his  death. 

8.  Debts  secured  by  mortgages,  bonds,  notes  or  bills;  accounts, 
money,  and  bank  bills,  or  other  circulating  medium,  things  in  action, 
and  stock  in  any  corporation  or  joint-stock  association. 

9.  Goods,  wares,  merchandise,  utensils,  furniture,  cattle,  provisions, 

63 


Fiduciary  Accounting 

moneys  unpaid  on  contracts  for  the  sale  of  lands  and  every  other 
species  of  personal  property  not  hereinafter  excepted.  Things  annexed 
to  the  freehold,  or  to  a  building,  shall  not  go  to  the  executor,  but  shall 
descend  with  the  freehold  to  the  heirs  or  devisees,  except  such  fixtures 
as  are  mentioned  in  the  fourth  subdivision  of  this  section.  The  right 
of  an  heir  to  any  property,  not  enumerated  in  this  section,  which  by 
the  common  law  would  descend  to  him,  is  not  impaired  by  the  general 
terms  of  this  section. 

Sect.  2713.  EXEMPTION  FOR  WIDOW  AND  CHILDREN. 
If  a  man  having  a  family  die,  leaving  a  widow  or  minor  child  or 
children,  following  articles  shall  not  be  deemed  assets,  but  must  be  in- 
cluded and  stated  in  the  inventory  of  the  estate  without  being  appraised : 

1.  All  spinning-wheels,  weaving-looms,  one  knitting-machine,  one 
sewing-machine,  and  stoves  put  up  or  kept  for  use  by  his  family. 

2.  The  family  Bible,  family  pictures,  and  school  books,  used  by  or 
in  such  family,  and  books  not  exceeding  in  value  fifty  dollars,  which 
were  kept  and  used  as  part  of  the  family  library. 

3.  Sheep  to  the  number  of  ten,  with  their  fleeces,  and  the  yarn 
and  cloth  manufactured  from  the  same;  one  cow,  two  swine,  and 
the  pork  of  such  swine,  and  necessary  food  for  such  swine,  sheep,  or 
cow  for  sixty  days,  and  all  necessary  provisions  and  fuel  for  such 
widow,  child,  or  children  for  sixty  days  after  the  death  of  such 
deceased  person. 

4.  All  necessary  wearing  apparel,  beds,  bedsteads  and  bedding, 
necessary  cooking  utensils,  the  clothing  of  the  family,  the  clothes  of 
the  widow  and  her  ornaments,  proper  for  her  station;  one  table,  six 
chairs,  twelve  knives  and  forks,  twelve  plates,  twelve  teacups  and 
saucers,  one  sugar  dish,  one  milkpot,  one  teapot  and  twelve  spoons, 
and  other  household  furniture  not  exceeding  one  hundred  and  fifty 
dollars  in  value. 

5.  Other  necessary  household  furniture,  provisions,  or  other  per- 
sonal property,  in  the  discretion  of  the  appraisers,  to  the  value  of 
not  exceeding  one  hundred  and  fifty  dollars. 

Such  articles  and  property  shall  remain  in  the  possession  of 
the  widow,  if  there  be  one,  during  the  time  she  lives  with  and  pro- 
vides for  such  minor  child  or  children.  If  she  ceases  so  to  do,  she 
'shall  be  allowed  to  retain  as  her  own,  her  wearing  apparel,  her  orna- 
ments, and  one  bed,  bedstead  and  the  bedding  for  the  same,  and  the 
property  specified  in  subdivision  five;  and  the  other  articles  so  ex- 
empted shall  then  belong  to  such  minor  child  or  children.  If  she 
lives  with  and  provides  for  such  minor  child  or  children  until  it  or 
they  become  of  full  age  all  the  articles  and  property  in  this  section 
mentioned  shall  belong  to  the  widow.  If  there  be  a  widow  and  no 
minor  child,  all  the  articles  and  property  in  this  section  mentioned  shall 
belong  to  the  widow.  If  a  married  woman  die,  leaving  surviving 
her  a  husband,  or  a  minor  child  or  children  the  same  articles  and 
personal  property  shall  be  set  apart  by  the  appraisers,  with  the  same 
effect   for  the  benefit  of  such  husband  or  minor  child  or  children. 

64 


Fidu cia/ry  A c counting 

Sect.  2714.  CONTENTS  OF  INVENTORY.  The  inventory  must 
contain  a  particular  statement  of  all  bonds,  mortgages,  notes  and  other 
securities  for  the  payment  of  money  belonging  to  the  deceased,  known 
to  the  executor  or  administrator;  with  the  name  of  the  debtor  in  each 
security,  the  date,  the  sum  originally  payable ;  the  indorsements  thereon, 
if  any,  with  their  dates  and  the  sum  which,  in  the  judgment  of  the 
appraisers,  is  collectible  on  each  security;  and  of  all  moneys,  whether 
in  specie  or  bank  bills,  or  other  circulating  medium,  belonging  to 
the  deceased,  which  have  come  to  the  hands  of  the  executor  or 
administrator,  and  if  none  have  come  to  his  hands,  the  fact  shall 
be  stated  in  the  inventory.  The  naming  of  a  person  executor  in  a 
will  does  not  operate  as  a  discharge  or  bequest  of  any  just  claim 
which  the  testator  had  against  him;  but  it  must  be  included  among 
the  credits  and  effects  of  the  deceased  in  the  inventory,  and  the 
executor  shall  be  liable  for  the  same  as  for  so  much  money  in  his 
hands  at  the  time  the  debt  or  demand  becomes  due,  and  he  must 
apply  and  distribute  the  same  in  the  payment  of  debts  and  legacies, 
and  among  the  next  of  kin,  as  part  of  the  personal  property  of  the 
deceased.  The  discharge  or  bequest  in  a  will  of  a  debt  or  demand 
of  the  testator  against  an  executor  named  therein,  or  against  any 
other  person  is  not  valid  as  against  the  creditors  of  the  deceased; 
but  must  be  construed  only  as  a  specific  bequest  of  such  debt  or 
demand ;  and  the  amount  thereof  must  be  included  in  the  inventory 
and,  if  necessary,  be  applied  in  the  payment  of  his  debts;  and  if  not 
necessary  for  that  purpose,  must  be  paid  in  the  same  manner  and 
proportion  as  other  specific  legacies.  If  personal  property  not  men- 
tioned in  any  inventory  come  to  the  possession  or  knowledge  of 
an  executor  or  administrator,  he  must  cause  the  same  to  be  appraised 
as  herein  required,  and  an  inventory  thereof  to  be  returned  within 
two  months  after  the  discovery  thereof;  and  the  making  of  such 
inventory  and  return  may  be  enforced  in  the  same  manner  as  in  the 
case  of  a  first  inventory. 

Sect.  2717.  SALE  OF  PERSONAL  PROPERTY.  If  an  executor 
or  administrator  discover  that  the  debts  against  any  deceased  person 
or  the  legacies  bequeathed  by  him  cannot  be  paid  and  satisfied  without 
a  sale  of  the  personal  property  of  the  deceased,  the  same,  so  far  as 
may  be  necessary  for  the  payment  of  such  debts  or  legacies,  must 
be  sold.  An  administrator  may  sell  the  personal  property  of  the 
intestate  at  any  time  when  it  is  necessary  to  do  so  for  the  purpose 
of  distribution.  The  sale  may  be  public  or  private,  and,  except  in 
the  city  of  New  York,  may  be  on  credit  not  exceeding  one  year,  with 
approved  security.  The  executor  or  administrator  is  not  responsible 
for  any  loss  happening  in  the  sale,  when  made  in  good  faith  and  with 
ordinary  prudence.  Articles  not  necessary  for  the  support  and  sub- 
sistence of  the  family  of  the  deceased,  or  not  specifically  bequeathed, 
must  be  first  sold,  and  articles  so  bequeathed  must  not  be  sold  until 
the  residue  of  the  personal  estate  has  been  applied  to  the  payment 
of  debts. 

6s 


Fiduciary  Accounting 

Sect.  2718.  ASCERTAINMENT  OF  DEBTS.  The  executor  or 
administrator  at  any  time  after  the  granting  of  his  letters,  may  insert 
a  notice  once  in  each  week  for  six  months  in  such  newspaper  or 
newspapers  printed  in  the  county  as  the  surrogate  directs,  requiring 
all  persons  having  claims  against  the  deceased  to  exhibit  the  same, 
with  the  vouchers  therefor,  to  him,  at  a  place  to  be  specified  in  the 
notice,  at  or  before  a  day  therein  named,  which  must  be  at  least  six 
months  from  the  day  of  the  first  publication  of  the  notice.  The 
executor  or  administrator  may  require  satisfactory  vouchers  in  support 
of  any  claim  presented  and  the  affidavit  of  the  claimant  that  the 
claim  is  justly  due,  that  no  payments  have  been  made  thereon,  and 
that  there  are  no  offsets  against  the  same  to  the  knowledge  of  the 
claimant.  If  the  executor  or  administrator  doubts  the  justice  of 
any  such  claim,  he  may  enter  into  an  agreement  in  writing  with 
the  claimant  to  refer  the  matter  in  controversy  to  one  or  more  disin- 
terested persons,  to  be  approved  by  the  surrogate.  On  filing  such 
agreement  and  approval  in  the  office  of  the  clerk  of  the  supreme 
court  in  the  county  in  which  the  parties  or  either  of  them  reside,  an 
order  shall  be  entered  by  the  clerk  referring  the  matter  in  controversy 
to  the  person  or  persons  so  selected.  On  the  entry  of  such  order  the 
proceding  shall  become  an  action  in  the  supreme  court.  The  same 
proceeding  shall  be  had  in  all  respects,  the  referees  shall  have  the 
same  powers,  be  entitled  to  the  same  compensation,  and  subject  to 
the  same  control  as  if  the  reference  had  been  made  in  an  action  in 
which  such  court  might,  by  law,  direct  a  reference.  In  determining 
the  question  of  costs  the  referee  shall  be  governed  by  sections  eighteen 
hundred  and  thirty-five  and  eighteen  hundred  and  thirty-six  of  this 
act.  Judgment  may  be  entered  on  the  report  of  the  referee  and  such 
judgment  shall  be  valid  and  effectual  in  all  respects  as  if  the  same 
had  been  rendered  in  a  suit  commenced  by  the  ordinary  process,  and 
the  practice  on  appeal  therefrom  shall  be  the  same  as  in  other  civil 
actions.  If  a  suit  be  brought  on  a  claim  which  is  not  presented 
to  the  executor  or  administrator  within  six  months  from  the  first 
publication  of  such  notice,  the  executor  or  administrator  shall  not  be 
chargeable  for  any  assets  or  moneys  that  he  may  have  paid  in  satis- 
faction of  any  lawful  claims,  or  of  any  legacies,  or  in  making  distribu- 
tion to  the  next  of  kin    before  such  suit  was  commenced. 

Sect.  2719.  PAYMENT  OF  DEBTS.  Every  executor  and  admin- 
istrator must  proceed  with  diligence  to  pay  the  debts  of  the  deceased 
according  to  the  following  order: 

1.  Debts  entitled  to  a  preference  under  the  laws  of  the  United 
States. 

2.  Taxes  assessed  on  the  property  of  the  deceased  previous  to  his 
death. 

3.  Judgments  docketed,  and  decrees  entered  against  the  deceased 
according  to  the  priority  thereof  respectively : 

4.  All  recognizances,  bonds,  sealed  instruments,  notes,  bills  and 
unliquidated  demands  and  accounts. 

66 


Fiduciary  Accounting 

Preference  shall  not  be  given,  in  the  payment  of  a  debt  over  other 
debts  of  the  same  class,  except  those  specified  in  the  third  class.  A 
debt  due  and  payable  shall  not  be  entitled  to  a  preference  over  a  debt 
not  due.  The  commencement  of  a  suit  for  the  recovery  of  a  debt 
or  the  obtaining  of  a  judgment  thereon  against  the  executor  or 
administrator  shall  not  entitle  such  debt  to  preference  over  others 
of  the  same  class.  Debts  not  due  may  be  paid  according  to  the  class 
to  which  they  belong,  after  deducting  a  rebate  of  legal  interest  on 
the  sum  paid  for  the  unexpired  term  of  credit  without  interest.  An 
executor  or  administrator  shall  not  satisfy  his  own  debt  or  claim  out 
of  the  property  of  the  deceased  until  proved  to  and  allowed  by  the 
surrogate;  and  it  shall  not  have  preference  over  others  of  the  same 
class.  Preference  may  be  given  by  the  surrogate  to  rents  due  or 
accruing  on  leases  held  by  the  testator  at  the  time  of  his  death,  over 
debts  of  the  fourth  class,  if  it  appear  to  his  satisfaction  that  such 
preference  will  benefit  the  estate  of  the  testator  or  intestate.  The 
surrogate  may  authorize  the  executor  or  administrator  to  compromise 
or  compound  a  debt  or  claim,  on  application,  and  for  good  and  suffi- 
cient cause  shown,  and  to  sell  at  public  auction  on  such  notice  as  the 
surrogate  prescribes,  any  uncollectible,  stale  or  doubtful  debt  or  claim 
belonging  to  the  estate ;  but  any  party  interested  in  the  final  settlement 
of  the  estate  may  show  on  such  settlement  that  such  debt  or  claim  was 
fraudulently  or  negligently  compromised  or  compounded. 

Sect.  2720.  APPORTIONMENT  OF  RENTS,  ANNUITIES 
AND  DIVIDENDS.  All  rents  reserved  on  any  lease  made  after  June 
seventh,  eighteen  hundred  and  seventy-five,  and  all  annuities,  divi- 
dends and  other  payments  of  every  description  made  payable  or 
becoming  due  at  fixed  periods  under  any  instrument  executed  after 
such  date,  or,  being  a  last  will  and  testament  that  takes  effect  after 
such  date,  shall  be  apportioned  so  that  on  the  death  of  any  person 
interested  in  such  rents,  annuities,  dividends  or  other  such  payments, 
or  in  the  estate  or  fund  from  or  in  respect  to  which  the  same  issues 
or  is  derived,  or  on  the  determination  by  any  other  means  of  the 
interest  of  any  such  person,  he,  or  his  executors,  administrators  or 
assigns,  shall  be  entitled  to  a  proportion  of  such  rents,  annuities, 
dividends  and  other  payments,  according  to  the  time  which  shall  have 
elapsed  from  the  commencement,  or  last  period  of  payment  thereof, 
as  the  case  may  be,  including  the  day  of  the  death  of  such  person, 
or  of  the  determination  of  his  or  her  interest,  after  making  allowance 
and  deductions  on  account  of  charges  on  such  rents,  annuities,  dividends 
and  other  payments.  Every  such  person  or  his  executors,  adminis- 
trators or  assigns  shall  have  the  same  remedies  at  law  and  in  equity 
for  recovering  such  apportioned  parts  of  such  rents,  annuities,  divi- 
dends and  other  payments,  when  the  entire  amount  of  which  such 
apportioned  parts  form  part,  become  due  and  payable  and  not  before, 
as  he  or  they  would  have  had  for  recovering  and  obtaining  such 
entire  rents,  annuities,  dividends  and  other  payments,  if  entitled 
thereto;  but  the  persons  liable  to  pay  rents  reserved  by  any  lease  or 

67 


Fiduciary  Accountins: 


t> 


demise,  or  the  real  property  comprised  therein  shall  not  be  resorted 
to  for  such  apportioned  parts,  but  the  entire  rents  of  which  such  appor- 
tioned parts  form  parts  must  be  collected  and  recovered  by  the  person 
or  persons  who,  but  for  this  section,  or  chapter  five  hundred  and 
forty-two  of  the  laws  of  eighteen  hundred  and  seventy-five,  would  have 
been  entitled  to  the  entire  rents;  and  such  portions  shall  be  recoverable 
from  such  person  or  persons  by  the  parties  entitled  to  the  same 
under  this  section.  This  section  shall  not  apply  to  any  case  in  which 
it  shall  be  expressly  stipulated  that  no  apportionment  be  made,  or  to 
any  sums  made  payable  in  policies  of  insurance  of  any  description. 

Sect.  2721.  PAYMENT  OF  LEGACIES.  No  legacy  shall  be 
paid  by  any  executor  or  administrator  until  after  the  expiration  of 
one  year  from  the  time  of  granting  letters  testamentary  or  of  adminis- 
tration, unless  directed  by  the  will  to  be  sooner  paid.  If  directed  to 
be  sooner  paid,  the  executor  or  administrator  may  require  a  bond, 
with  two  sufficient  sureties,  conditioned,  that  if  debts  against  the 
deceased  duly  appear,  and  there  are  not  other  assets  to  pay  the  same, 
and  no  other  assets  sufficient  to  pay  other  legacies,  then  the  legatees 
will  refund  the  legacy  so  paid  or  such  ratable  proportion  thereof  with 
the  other  legatees,  as  may  be  necessary  for  the  payment  of  such  debts, 
and  the  proportional  parts  of  such  other  legacies,  if  there  be  any,  and 
the  costs  and  charges  incurred  by  reason  of  the  payment  to  such  legatee, 
and  that  if  this  probate  of  the  will  under  which  such  legacy  is  paid  be 
revoked,  or  the  will  declared  void,  that  such  legatee  will  refund  the 
whole  of  such  legacy,  with  interest,  to  the  executor  or  administrator 
entitled  thereto.  After  the  expiration  of  one  year  the  executors  and 
administrators  must  discharge  the  specific  legacies  bequeathed  by  will, 
and  pay  the  general  legacies,  if  there  be  assets.  If  there  are  not 
sufficient  assets,  then  an  abatement  of  the  general  legacies  must  be  made 
in  equal  proportions.  Such  payment  shall  be  enforced  by  the  surrogate 
in  the  same  manner  as  the  return  of  an  inventory,  and  by  a  suit 
on  the  bond  of  such  executor  or  administrator  whenever  directed  by 
the  surrogate. 

Sect.  2722.  PETITION  TO  COMPEL  PAYMENTS;  HEAR- 
ING; DECREE.  In  either  of  the  following  cases  a  petition  may  be 
presented  to  the  surrogate's  court,  praying  for  a  decree  directing  an 
executor  or  administrator  to  pay  the  petitioner's  claim,  and  that  he 
be  cited  to  show  cause  why  such  a  decree  should  not  be  made: 

1.  By  a  creditor,  for  the  payment  of  a  debt,  or  of  its  just  propor- 
tional part,  at  any  time  after  six  months  have  expired  since  letters 
were  granted. 

2.  By  a  person  entitled  to  a  legacy  or  any  other  pecuniary  pro- 
vision under  the  will,  or  a  distributive  share,  for  the  payment  or 
satisfaction  thereof,  or  of  its  just  proportional  part,  at  any  time  after 
one  year  has  expired  since  letters  were  granted. 

3.  By  the  attorney-general,  in  any  case  where  a  decedent  died 
intestate  as  to  any  of  his  estate,  leaving  no  known  heirs  or  next 
of  kin. 

68 


Fiduciary  Accounting 

On  the  presentation  of  such  a  petition,  the  surrogate  must  issue 
a  citation  accordingly;  and  on  the  return  thereof,  he  must  make  such 
a  decree  in  the  premises  as  justice  requires.  But  in  either  of  the 
following  cases  the  decree  must  dismiss  the  petition  without  prejudice 
to  an  action  or  an  accounting,  in  behalf  of  the  petitioner : 

1.  Where  an  executor  or  administrator  files  a  written  answer, 
duly  verified,  setting  forth  facts  which  show  that  it  is  doubtful  whether 
the  petitioner's  claim  is  valid  and  legal,  and  denying  its  validity  or 
legality,  absolutely,  or  on  information  and  belief. 

2.  Where  it  is  not  proved  to  the  satisfaction  of  the  surrogate,  that 
there  is  money  or  other  personal  property  of  the  estate,  applicable  to 
the  payment  or  satisfaction  of  the  petitioner's  claim,  and  which  may 
be  so  applied,  without  injuriously  affecting  the  rights  of  others,  entitled 
to  priority  or  equality  of  payment  or  satisfaction. 

Sect.  2723.  DECREE  FOR  PAYMENT  OF  LEGACY,  ETC, 
ON  GIVING  SECURITY.  In  a  case  specified  in  subdivision  second 
of  the  last  section,  the  surrogate  may,  in  his  discretion,  entertain  the 
petition,  at  any  time  after  letters  are  granted,  although  a  year  has 
not  expired.  In  such  a  case,  if  it  appears,  on  the  return  of  the  citation, 
that  a  decree  for  payment  may  be  made,  as  prescribed  in  the  last  sec- 
tion ;  and  that  the  amount  of  money  and  the  value  of  the  other  property 
in  the  hands  of  the  executor  or  administrator  applicable  to  the  payment 
of  debts,  legacies  and  expenses,  exceed,  by  at  least  one-third,  the  amount 
of  all  known  debts  and  claims  against  the  estate,  of  all  legacies  which 
are  entitled  to  priority  over  the  petitioner's  claim,  and  of  all  legacies 
of  distributive  shares  of  the  same  class;  and  that  the  payment  or 
satisfaction  of  the  legacy,  pecuniary  provision  or  distributive  share, 
or  some  part  thereof,  is  necessary  for  the  support  or  education  of 
the  petitioner;  the  surrogate  may  in  his  discretion,  make  a  decree 
directing  payment  or  satisfaction  accordingly,  on  the  filing  of  a  bond, 
approved  by  the  surrogate,  conditioned  as  prescribed  by  law,  with 
respect  to  a  bond  which  an  executor  or  an  administrator  with  the 
will  annexed  may  require  from  a  legatee,  on  payment  or  satisfaction 
pf  a  legacy,  before  the  expiration  of  one  year  from  the  time  when 
letters  were  issued,  pursuant  to  a  direction  to  that  effect  contained 
in  the  will. 

Sect.  2725.  INTERMEDIATE  ACCOUNTING.  An  executor  or 
administrator  at  any  time,  may,  voluntarily,  file  in  the  surrogate's 
office  an  intermediate  account,  and  the  vouchers  in  support  of  the 
same.  In  either  of  the  following  cases,  the  surrogate  may,  in  his 
discretion,  make  an  order,  requiring  an  executor  or  administrator  to 
render  an  intermediate  account: 

1.  Where  an  application  for  an  order,  permitting  an  execution,  to 
issue  on  a  judgment  against  the  executor  or  administrator,  has  been 
made  by  the  judgment  creditor,  as  prescribed  in  section  eighteen  hun- 
dred and  twenty-six  of  this  act. 

2.  On  the  return  of  a  citation,  issued  on  the  petition  of  a  judgment 
creditor,  praying  for  a  decree,  granting  leave  to  issue  an  execution 

69 


Fiduciary  Accounting 

on  a  judgment  rendered  against  the  decedent  in  his  lifetime    as  pre- 
scribed in  section  thirteen  hundred  and  eighty-one  of  this  act. 

3.  On  the  return  of  a  citation,  issued  on  the  petition  of  a  creditor^ 
or  person  entitled  to  a  legacy,  or  other  pecuniary  provision,  or  a 
distributive  share,  or  of  the  attorney-general,  praying  for  a  decree 
directing  payment  thereof,  as  prescribed  in  section  twenty-seven  hun- 
dred and  twenty-two  of  this  act. 

4.  Where  eighteen  months  have  elapsed  since  letters  were  issued, 
and  no  special  proceeding  on  a  petition  for  a  judicial  settlement,  of  the 
executor's  or  administrator's  account  is  pending. 

Sect.  2726.  WHEN  SURROGATE  MAY  REQUIRE  JUDICIAL 
SETTLEMENT  OE  ACCOUNT.  In  either  of  the  following  cases, 
the  surrogate's  court  may,  from  time  to  time,  compel  a  judicial  settle- 
ment of  the  account  of  an  executor  or  administrator: 

1.  Where  one  year  has  expired  since  letters  were  issued  to  him. 

2.  Where  letters  issued  to  him  have  been  revoked,  or,  for  any 
other  reason,  his  powers  have  ceased. 

3.  Where  a  decree  for  the  disposition  of  real  property,  or  of  an 
interest  in  real  property,  has  been  made,  as  prescribed  in  title  fifth 
of  this  chapter,  and  the  property,  or  a  part  thereof,  has  been  disposed 
of  by  him  pursuant  to  the  decree. 

4.  Where  he  has  sold,  or  otherwise  disposed  of,  any  of  the 
decedent's  real  property,  or  the  rents,  profits  or  proceeds  thereof, 
pursuant  to  a  power  contained  in  the  decedent's  will,  where  one 
year  has  elapsed  since  letters  were  issued  to  him.  The  surrogate's 
court  may  compel  a  judicial  settlement  of  the  account  of  a  temporary 
administrator  at  any  time.  It  may  also  compel  a  judicial  settlement 
of  the  account  of  a  freeholder,  appointed  to  dispose  of  a  decedent's 
real  property,  or  interest  in  real  property,  as  prescribed  in  title  fifth 
of  this  chapter,  in  like  manner  as  where  the  same  has  been  disposed 
of  by  the  executor  or  administrator. 

Sect.  2727.  CITATION :  ORDER  TO  ACCOUNT,  AND  PRO- 
CEEDINGS THEREON.  A  petition  praying  for  the  judicial  settle- 
ment of  an  account,  and  that  the  executor  and  administrator  be  cited 
to  show  cause  why  he  should  not  render  and  settle  his  account,  may 
be  presented,  in  a  case  prescribed  in  the  last  section,  by  a  creditor 
or  person  interested  in  the  estate  or  fund,  including  a  child  born  after 
the  making  of  a  will;  or  by  any  person,  in  behalf  of  an  infant  so 
interested;  or  by  a  surety  in  the  official  bond  of  the  person  required 
to  account,  or  the  legal  representative  of  such  a  surety,  or  by  the  attorney- 
general,  in  any  case  where  the  decedent  died  intestate  as  to  any  of 
his  estate,  leaving  no  known  heirs  or  next  of  kin.  On  the  presentation 
of  such  a  petition,  a  citation  must  be  issued  accordingly;  except  that 
in  a  case  specified  in  subdivision  first  of  the  last  section,  if  the  petition 
is  presented  within  eighteen  months  after  letters  were  issued,  to  the 
executor  or  administrator,  the  surrogate  may  entertain  or  decline  to 
entertain  it,  in  his  discretion.  On  the  return  of  a  citation  issued  as 
prescribed  in  either  of  the   foregoing  sections  of  this  article,   if  the 

70 


Fiduciary  Accounting 

executor  or  administrator  fails  either  to  appear,  or  to  show  good  cause 
to  the  contrary,  or  to  present  in  a  proper  case,  a  petition  as  prescribed 
in  the  next  section,  an  order  must  be  made,  directing  him  to  account 
within  such  time,  and  in  such  manner  as  the  surrogate  prescribes,  and 
to  attend,  from  time  to  time,  before  the  surrogate,  for  that  purpose. 
The  executor  or  administrator  is  bound  by  such  an  order,  without 
service  thereof.  If  he  disobeys  it  the  surrogate  may  issue  a  warrant 
of  attachment  against  him,  and  his  letters  may  be  revoked,  as  where 
a  warrant  of  attachment  issued  to  compel  the  return  of  an  inventory. 
If  it  appears  that  there  is  a  surplus,  distributable  to  creditors  or  per- 
sons interested,  the  surrogate,  may,  at  any  time,  issue  a  supplemental 
citation,  directed  to  the  persons  who  must  be  cited,  on  the  petition 
of  an  executor  or  administrator  for  a  judicial  settlement  of  his 
account,  and  requiring  them  to  attend  the  accounting.  The  pendency 
of  a  proceeding  against  an  executor  or  administrator  to  compel  him 
to  account  does  not  preclude  him  from  presenting  a  petition  as  pre- 
scribed in  the  next  section.  If  such  petition  is  presented  at  or  before 
the  return  of  a  citation  in  and  as  prescribed  in  either  of  the  fore- 
going sections  of  this  title,  the  citation  issued  thereon  need  not  be 
directed  to  petitioner  in  the  special  proceeding  pending  against  the 
executor  or  administrator,  and  the  two  proceedings  must  be  consoli- 
dated. The  surrogate  may,  in  his  discretion,  and  on  such  terms  as 
may  be  just,  direct  the  consolidation  of  any  two  or  more  of  such 
proceedings  pending  before  him,  and  such  consolidation  does  not 
affect  any  power  of  the  surrogate  which  might  be  exercised  in  either 
proceeding. 

Sect.  2728.  EXECUTORS,  ET  CETERA,  MAY  PETITION  FOR 
JUDICIAL  SETTLEMENT ;  CITATION  THEREUPON.  In  either 
of  the  following  cases  an  executor  or  administrator  may  present  to 
the  surrogate's  court  his  account  and  a  written  petition  duly  verified, 
praying  that  his  account  may  be  judicially  settled;  and  that  the 
sureties  in  his  official  bond  or  the  legal  representatives  of  such  surety 
and  all  creditors  or  persons  claiming  to  be  creditors  of  the  decedent, 
except  such,  as  by  vouchers  annexed  to  the  account  filed,  appear  to 
have  been  paid,  and  the  decedent's  husband  or  wife,  next  of  kin  and 
legatees,  if  any;  or,  if  either  of  those  persons  had  died,  his  executor 
or  administrator,  if  any,  and  the  attorney-general  in  a  case  where 
decedent  died  intestate  as  to  any  part  of  his  estate,  leaving  no  known 
heirs  or  next  of  kin,  shall  be  cited  to  attend  the  settlement ;  but  where 
the  decedent  leaves  a  will  which  has  been  duly  admitted  to  probate, 
it  shall  not  be  necessary  to  cite  the  decedent's  next  of  kin,  unless 
they  are  also  legatees: 

1.  Where  one  year  has  elapsed  since  letters  were  issued  to  such 
executor  or  administrator. 

2.  Where  notice  requiring  all  persons  having  claims  against  the 
deceased  to  exhibit  the  same  with  the  vouchers  thereof  to  such 
executor  or  administrator  has  been  duly  published  according  to  law. 
If  one  of  two  or  more  co-executors  or  co-administrators  presents  his 

71 


Fiduciary  Accounting 

account  and  a  petition  for  a  judicial  settlement  of  his  separate  account, 
it  must  pray  that  his  co-executors  or  co-administrators  may  also  be 
cited.  Upon  the  presentation  of  accounts  and  a  petition,  as  prescribed 
in  this  section,  the  surrogate  must  issue  a  citation  accordingly.  On 
the  return  of  a  citation,  issued  as  prescribed  in  this  section,  the  surro- 
gate must  take  the  account,  and  hear  the  allegations  and  proofs  of  the 
parties  respecting  the  same.  Any  party  may  contest  the  account,  with 
respect  to  a  matter  affecting  his  interest  in  the  settlement  and  distri- 
bution of  the  estate.  And  any  party  may  contest  an  intermediate 
account  rendered  under  section  twenty-seven  hundred  and  twenty-five 
of  this  act  in  case  the  same  shall  not  be  consolidated  pursuant  to 
section  twenty-seven  hundred  and  twenty-seven  of  this  act.  A  creditor, 
or  a  person  interested  in  the  estate,  although  not  cited,  is  entitled  to 
appear  on  the  hearing,  and  thus  make  himself  a  party  to  the  proceeding. 
When  letters  issued  to  an  executor  or  administrator  have  been  revoked, 
he  may  present  to  the  surrogate's  court  a  written  petition,  duly  verified, 
praying  that  his  account  be  judicially  settled,  and  that  his  successor, 
if  a  successor  has  been  appointed,  and  the  other  persons  specified  in 
this  section  be  cited  to  attend  the  settlement. 

Sect.  2729.  AFFIDAVIT  TO  ACCOUNT;  VOUCHERS;  EX- 
AMINATION OF  ACCOUNTING  PARTY;  FUNERAL  EX- 
PENSES. To  each  account  filed  with  the  surrogate,  as  prescribed  in 
this  article,  must  be  appended  the  affidavit  of  the  accounting  party, 
to  the  effect  that  the  account  contains,  according  to  the  best  of 
his  knowledge  and  belief,  a  full  and  true  statement  of  all  his  receipts 
and  disbursements  on  account  of  the  estate  of  the  decedent;  and  of 
all  money  and  other  property  belonging  to  the  estate,  which  have 
come  to  his  hands,  or  been  received  by  any  other  person,  by  his  order 
or  authority,  for  his  use;  and  that  he  does  not  know  of  any  error 
or  omission  in  the  account  to  the  prejudice  of  any  creditor  of,  or 
person  interested  in,  the  estate  of  the  decedent.  On  an  accounting 
by  an  executor  or  administrator,  the  accounting  party  must  produce 
and  file  a  voucher  for  every  payment,  except  in  one  of  the  following 
cases : 

1.  He  may  be  allowed,  without  a  voucher,  any  proper  item  of 
expenditure,  not  exceeding  twenty  dollars,  if  it  is  supported  by  his 
own  uncontradicted  oath,  stating  positively  the  fact  of  payment,  and 
specifying  when  and  to  whom  the  payment  was  made ;  but  all  the 
items  so  allowed  against  an  estate,  on  all  accountings  of  all  the  execu- 
tors or  administrators,  shall  not  exceed  five  hundred  dollars. 

2.  If  he  proves,  by  his  own  oath  or  another's  testimony,  that  he 
did  not  take  a  voucher  when  he  made  the  payment ;  or  that  the  voucher 
then  taken  by  him  has  been  lost  or  destroyed,  he  may  be  allowed 
any  item  the  payment  of  which  he  satisfactorily  proves  by  the  testi- 
mony of  the  person  to  whom  he  made  it;  or,  if  that  person  is  dead, 
or  cannot,  after  diligent  search,  be  found,  by  any  competent  evidence, 
other  than  his  own  oath  ,or  that  of  his  wife.  But  an  allowance  cannot 
be  made,  as  specified  in  this  section,  unless  the  surrogate  is  satisfied 

72 


Fiduciary  Accounting 

that  the  charge  is  correct  and  just.  The  surrogate  may  at  any  time 
make  an  order  requiring  the  accounting  party  to  make  and  file  his 
account;  or  to  attend,  and  be  examined  under  oath,  touching  his 
receipts  and  disbursements;  or  touching  any  other  matter  relating  to 
his  administration  of  the  estate,  or  any  act  done  by  him  under  color 
of  his  letters,  or  after  the  decedent's  death,  and  before  the  letters 
were  issued;  or  touching  any  personal  property,  owned  or  held  by 
the  decedent,  at  the  time  of  his  death.  No  profit  shall  be  made  by 
any  executor  or  administrator  by  the  increase,  nor  shall  he  sustain 
any  loss  by  the  decrease,  without  his  fault,  of  any  part  of  the  estate; 
but  he  shall  account  for  such  increase,  and  be  allowed  for  such  decrease, 
on  the  settlement  of  his  accounts.  On  the  judicial  settlement  of  the 
account  of  an  executor  or  administrator,  the  surrogate  may  allow 
the  accounting  party,  for  property  of  the  decedent  perished  or  lost 
without  the  fault  of  the  accounting  party. 

3.  Every  executor  or  administrator  shall  pay,  out  of  the  first 
moneys  received,  the  reasonable  funeral  expenses  of  decedent,  and 
the  same  shall  be  preferred  to  all  debts  and  claims  against  the  deceased. 
If  the  same  be  not  paid  within  sixty  days  after  the  grant  of  letters 
testamentary  or  of  administration,  the  person  having  a  claim  for  such 
funeral  expenses  may  present  to  the  surrogate's  court  a  duly  verified 
petition  praying  that  the  executor  or  administrator  may  be  cited 
to  show  cause  why  he  should  not  be  required  to  make  such  payment, 
and  a  citation  shall  be  issued  accordingly.  If,  upon  the  return  of  such 
citation,  it  shall  appear  that  the  executor  or  administrator  has  received 
moneys  belonging  to  the  estate  which  are  applicable  to  the  payment 
of  the  claims  for  funeral  expenses,  the  surrogate  shall,  unless  the 
validity  of  the  claim  and  the  reasonableness  of  its  amount  are  admitted 
by  such  executor  or  administrator,  take  proof  as  to  such  facts,  and 
if  satisfied  that  such  claim  is  valid  shall  fix  and  determine  the  amount 
due  thereon  and  shall  make  an  order  directing  the  payment  within 
ten  days  after  the  service  of  such  order  with  notice  of  entry  thereof, 
upon  such  executor  or  administrator  of  such  claim  or  such  proportion 
thereof  as  the  money  in  the  hands  of  the  executor  or  administrator 
applicable  thereto,  may  be  sufficient  to  satisfy.  If  it  shall  appear  that 
no  money  has  come  into  the  hands  of  the  executor  or  administrator 
the  proceeding  shall  be  dismissed  without  costs  and  without  prejudice 
to  a  further  application  or  applications  showing  that  since  such  dis- 
missal the  executor  or  administrator  has  received  money  belonging 
to  the  estate.  Such  application  shall  be  made  upon  a  duly  verified 
petition  stating  the  facts  upon  which  the  belief  of  the  petitioner  that 
there  are  moneys  in  the  hands  of  such  executor  or  administrator 
applicable  to  the  payment  of  his  claim,  is  based.  Upon  such  further 
application  the  issuance  of  the  citation  shall  be  in  the  discretion  of 
the  surrogate  and  no  such  application  shall  be  made  less  than  three 
months  after  the  granting  or  denial  of  any  previous  application.  If 
upon  any  accounting  it  shall  appear  that  an  executor  or  administrator 
has  failed  to  pay  a  claim  for  funeral  expenses,  the  amount  of  which 

73 


Fiduciary  Accounting: 


has  been  fixed  and  determined  by  the  surrogate  as  above  set  forth 
or  upon  such  accounting  he  shall  not  be  allowed  for  the  payment  of 
any  debt  or  claim  against  the  decedent  until  said  claim  has  been 
discharged  in  full;  but  such  claim  shall  not  be  paid  before  expenses 
of   administration   are   paid. 

Sect.  2730.  COMMISSIONS  OF  EXECUTOR  OR  ADMINIS- 
TRATOR. On  settlement  of  the  account  of  an  executor  or  adminis- 
trator, the  surrogate  must  allow  to  him  for  his  services,  and  if  there 
be  more  than  one,  apportion  among  them  according  to  the  services 
rendered  by  them  respectively,  over  and  above  his  or  their  expenses: 
For  receiving  and  paying  out  all  sums  of  money  not  exceeding  one 
thousand  dollars,  at  the  rate  of  five  per  centum.  For  receiving  and 
paying  out  any  additional  sums  not  amounting  to  more  than  ten 
thousand  dollars,  at  the  rate  of  two  and  one-half  per  centum.  For 
all  sums  above  eleven  thousand  dollars  at  the  rate  of  one  per  centum. 
In  all  cases  such  allowance  must  be  made  for  their  necessary  expenses 
actually  paid  by  them  as  appears  just  and  reasonable.  If  the  gross 
value  of  the  personal  property  of  the  decedent  amounts  to  one  hun- 
dred thousand  dollars  or  more  each  executor  or  administrator  is 
entitled  to  the  full  compensation  on  principal  and  income  allowed 
herein  to  a  sole  executor  or  administrator,  unless  there  are  more 
than  three,  in  which  case  the  compensation  to  which  three  would 
be  entitled  must  be  apportioned  among  them  according  to  the  services 
rendered  by  them  respectively,  and  a  like  apportionment  shall  be 
made  in  all  cases  where  there  shall  be  more  than  one  executor  or 
administrator.  Where  the  will  provides  a  specific  compensation  to 
an  executor  or  administrator  he  is  not  entitled  to  any  allowance 
for  his  services,  unless  by  a  written  instrument  filed  with  the  surrogate, 
he  renounces  the  specific  compensation.  Where  successive  or  different 
letters  are  issued  to  the  same  person  on  the  estate  of  the  same 
decedent,  including  a  case  where  letters  testamentary,  or  letters  of 
general  administration,  are  issued  to  a  person  who  has  been  previously 
appointed  a  temporary  administrator,  he  is  entitled  to  compensation 
in  one  capacity  only,  at  his  selection,  except  that  where  he  has  received 
compensation  in  one  capacity  he  is  entitled  to  the  excess,  if  any,  of 
the  compensation  allowed  by  law,  above  the  sum  which  he  has  already 
received  in  the  other  capacity. 

Sect.  2742.  EFFECT  OF  JUDICIAL  SETTLEMENT  OF  AC- 
COUNT. A  judicial  settlement  of  the  account  of  an  executor  or 
administrator,  either  by  the  decree  of  the  surrogate's  court,  or  upon 
an  appeal  therefrom,  is  conclusive  evidence,  against  all  the  parties  who 
were  duly  cited  or  appeared,  and  all  persons  deriving  title  from  any 
of  them  at  any  time,  of  the  following  facts,  and  no  others : 

1.  That  the  items  allowed  to  the  accounting  party,  for  money  paid 
to  creditors,  legatees,  and  next  of  kin,  for  necessary  expenses,  and 
for  his  services,  are  correct. 

2.  That  the  accounting  party  has  been  charged  with  all  the  interest 
for  money  received  by  him,  and  embraced  in  the  account,  for  which 
he  was  legally  accountable. 

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Fiduciary  Accounting 

3.  That  the  money  charged  to  the  accounting  party,  as  collected, 
is  all  that  was  collectible,  at  the  time  of  the  settlement,  on  the  debts 
stated  in  the  account. 

4.  That  the  allowances  made  to  the  accounting  party,  for  the 
decrease,  and  the  charges  against  him  for  the  increase,  in  the  value 
of  property,  were  correctly  made. 

Sect.  2744.  WHEN  DECREE  MAY  ORDER  DELIVERY  OF 
SPECIFIC  PROPERTY.  In  either  of  the  following  cases,  the  decree 
may  direct  the  delivery  of  an  unsold  chattel,  or  the  assignment  of  an 
uncollected  demand,  or  any  other  personal  property,  to  a  party  or 
parties  entitled  to  payment  or  distribution,  in  lieu  of  the  money  value 
of  the  property : 

1.  Where  all  the  parties  interested,  who  have  appeared,  manifest 
their  consent  thereto  by  a  writing  filed  in  the  surrogate's  office. 

2.  Where  it  appears  that  a  sale  thereof,  for  the  purpose  of  pay- 
ment or  distribution,  would  cause  a  loss  to  the  parties  entitled  thereto. 

The  value  must  be  ascertained,  if  the  consent  does  not  fix  it,  by 
an  appraisement  under  oath,  made  by  one  or  more  persons  appointed 
by  the  surrogate  for  the  purpose. 

Sect.  2746.  SHARE  OF  INFANT.  When  a  legacy  or  distributive 
share  is  payable  to  an  infant,  the  decree  may,  in  the  discretion  of  the 
surrogate's  court,  direct  it,  or  so  much  of  it  as  may  be  necessary,  to 
be  paid  to  his  general  guardian,  to  be  applied  to  his  support  and  edu- 
cation ;  or  when  it  does  not  exceed  two  hundred  and  fifty  dollars,  the 
decree  may  order  it  to  be  paid  to  his  father  or  to  his  mother  or  to 
some  competent  person  with  whom  the  infant  resides  or  who  has 
some  interest  in  his  welfare,  for  the  use  and  benefit  of  such  infant. 
Such  court  may,  in  its  discretion,  by  its  decree,  direct  any  legacy 
or  distributive  share,  or  part  of  a  legacy  or  distributive  share,  not 
paid  or  applied  as  aforesaid,  which  is  payable  to  an  infant,  to  be  paid 
to  the  general  guardian  of  such  infant,  upon  his  executing  and  deposit- 
ing with  the  surrogate  in  his  office,  a  bond  running  to  such  infant, 
with  two  or  more  sufficient  sureties,  duly  acknowledged  and  ap- 
proved by  the  surrogate,  in  double  the  amount  of  such  legacy  or  dis- 
tributive share,  conditioned  that  such  general  guardian  shall  faithfully 
apply  such  legacy  or  distributive  share,  and  render  a  true  and  just 
account  of  the  application  thereof,  in  all  respects,  to  any  court  having 
cognizance  thereof,  when  thereunto  required,  the  sureties  in  which 
bond  shall  justify  as  required  in  this  act,  unless  the  surrogate  shall 
determine  that  the  general  bond  given  by  the  guardian  is  ample  and 
of  sufficient  amount  to  cover  such  legacy  or  distributive  share.  The 
said  court  may,  in  its  discretion,  from  time  to  time,  authorize  or  direct 
such  general  guardian  to  expend  such  part  of  such  legacy  or  distribu- 
tive share,  in  the  support,  maintenance  and  education  of  such  infant, 
as  it  deems  necessary.  On  such  infant's  coming  twenty-one  years  of 
age,  he  shall  be  entitled  to  receive,  and  his  general  guardian  shall  pay 
or  deliver  to  him,  under  the  direction  of  the  surrogate's  court,  the 
securities  so  taken,  and  the  interest  or  other  moneys  that  may  have 

75 


Fiduciary  Accounting 

been  paid  to  or  received  by  such  general  guardian,  after  deducting 
therefrom  such  amounts  as  have  been  paid  or  expended  in  pursuance 
of  the  orders  and  decrees  of  said  court,  so  made  as  aforesaid  and 
the  legal  commissions  of  such  guardian;  and  the  general  guardian 
shall  be  liable  to  account  in  and  under  the  direction  of  the  surrogate's 
court,  to  his  ward,  for  the  same;  in  case  of  the  death  of  said  infant^ 
before  coming  of  age,  the  said  securities  and  moneys,  after  making 
the  deductions  aforesaid,  shall  go  to  his  executors  or  administrators, 
to  be  applied  and  distributed  according  to  law,  and  the  general  guardian 
shall  in  like  manner  be  liable  to  account  to  such  administrator  or 
executor.  If  there  be  no  general  guardian,  or  if  the  surrogate's  court 
do  not  order  or  decree  the  payment  or  disposition  of  the  legacy  or 
distributive  share  in  some  of  the  ways  above  described,  then  the 
legacy  or  distributive  share,  or  part  of  the  same  not  disposed  of 
as  aforesaid,  whether  the  same  consists  of  money  or  securities,  shall, 
by  order  or  decree  of  the  surrogate's  court,  be  paid  and  delivered  to 
and  deposited  in  said  court,  by  paying  and  delivering  the  same  to 
and  depositing  it  with  the  county  treasurer  of  the  county,  to  be  held, 
managed,  invested,  collected,  reinvested  and  disposed  of  by  him,  as 
prescribed  and  required  by  section  2537  of  this  act.  The  regulations 
contained  in  the  general  rules  of  practice,  as  specified  in  subdivision 
eight  of  section  four  of  the  State  Finance  Law,  and  the  provisions 
of  title  three  of  chapter  eight  of  this  act  apply  to  money,  legacies 
and  distributive  shares  paid  to  and  securities  deposited  with  the 
county  treasurer,  as  prescribed  in  this  section;  except  that  the  surro- 
gate's court  exercises  with  respect  thereto,  or  with  respect  to  a  security 
in  which  any  of  the  money  has  been  invested,  or  upon  which  it  has 
been  loaned,  the  power  and  authority  conferred  upon  the  supreme  court 
by  section  747  of  this  act. 

Sect.  2747.  LEGACY  TO  UNKNOWN  PERSON  PAID  TO 
STATE;  HOW  OBTAINED  BY  CLAIMANT.  Where  the  person 
entitled  to  a  legacy  or  distributive  share  is  unknown,  the  decree  must 
direct  the  executor  or  administrator  to  pay  the  amount  thereof  into 
the  treasury  of  the  state,  for  the  benefit  of  the  person  or  persons  who 
may  thereafter  appear  to  be  entitled  thereto.  The  surrogate,  or  the 
supreme  court,  upon  the  petition  of  a  person  claiming  to  be  so  entitled, 
and  upon  at  least  fourteen  days'  notice  to  the  attorney-general,  ac- 
companied with  a  copy  of  the  petition,  may  by  a  reference,  or  by 
directing  the  trial  of  an  issue  by  a  jury,  or  otherwise,  ascertain  the 
rights  of  the  persons  interested,  and  grant  an  order  directing  the 
payment  of  any  money,  which  appears  to  be  due  to  the  claimant,  but 
without  interest,  and  deducting  all  expenses  incurred  by  the  state 
with  respect  to  the  decedent's  estate.  The  comptroller,  upon  the 
production  of  a  certified  copy  of  the  order,  must  draw  his  warrant 
upon  the  treasury,  for  the  amount  therein  directed  to  be  paid;  which 
must  be  paid  by  the  state  treasurer,  to  the  person  entitled  thereto. 

Sect.  2748.  UNCLAIMED  LEGACY  TO  BE  PAID  TO  COUNTY 
TREASURER.     The  decree  must  also  direct  the  executor  or  admin- 

76 


Fiduciary  Accounting 

istrator  to  pay  to  the  county  treasurer,  a  legacy  or  distributive  share, 
which  is  not  paid  to  the  person  entitled  thereto,  at  the  expiration  of 
two  years  from  the  time  when  the  decree  is  made,  or  when  the  legacy 
or  distributive  share  is  payable  by  the  terms  of  the  decree.  The  money, 
so  paid  to  the  county  treasurer,  can  be  paid  out  by  him  only  by  the 
special  direction  of  the  surrogate;  or  pursuant  to  the  judgment  of  a 
court  of  competent  jurisdiction. 

Sect.  2749.  WHAT  PROPERTY  SUBJECT  TO  THIS  TITLE. 
Real  property,  of  which  a  decedent  died  seized,  and  the  interest  of  a 
decedent  in  real  property,  held  by  him  under  a  contract  for  the  pur- 
chase thereof,  made  either  with  him,  or  with  a  person  from  whom  he 
derived  his  interest,  may  be  disposed  of,  for  the  payment  of  his  debts 
and  funeral  expenses,  or  for  the  payment  of  judgment  liens  existing 
thereon  at  his  death,  as  prescribed  in  this  title ;  except  where  it  is 
devised,  expressly  charged  with  the  payment  of  debts  or  funeral 
expenses,  or  is  exempted  from  levy  and  sale  by  virtue  of  an  execution, 
as  prescribed  in  title  second  of  chapter  thirteen  of  this  act.  The 
expression,  "funeral  expenses,"  as  used  in  this  title,  includes  a  reason- 
able charge  for  a  suitable  headstone. 

Sect.  2750.  PETITION  FOR  DISPOSITION  OF  DECEDENT'S 
REAL  PROPERTY  FOR  PAYMENT  OF  HIS  DEBTS,  ETC.  At 
any  time  within  three  years  after  letters  were  first  duly  granted  within 
the  state,  upon  the  estate  of  a  decedent,  an  executor  or  administrator, 
whether  sole  or  joined  in  the  letters  with  another  other  than  a  tem- 
porary administrator,  or  a  person  holding  a  judgment  lien  upon 
decedent's  real  property  at  the  time  of  his  death,  or  any  other  creditor 
of  the  decedent,  other  than  a  creditor  by  a  mortgage,  which  is  a  lien 
upon  the  decedent's  real  property,  or  any  person  having  a  claim  for 
the  funeral  expenses  of  the  decedent,  may  present  to  the  surrogate's 
court,  from  which  letters  were  issued,  a  written  petition,  duly  verified, 
praying  for  a  decree  directing  the  disposition  of  the  decedent's  real 
property,  or  interest  in  real  property,  specified  in  the  last  section,  or 
so  much  thereof  as  is  necessary  for  the  payment  of  his  debts  or  funeral 
expenses,  or,  if  so  decreed  as  hereinafter  provided,  for  the  payment 
of  any  judgment  liens  existing  upon  such  land,  or  some  portion  thereof, 
at  decedent's  death,  by  the  mortgage,  lease  or  sale  at  public  or  private 
sale  thereof;  and  that  the  parties  named  in  the  petition  and  all  other 
necessary  parties,  as  prescribed  in  the  subsequent  sections  of  this  title, 
may  be  cited  to  show  cause  why  such  a  decree  should  not  be  made. 

Sect.  2774.  WHO  FORBIDDEN  TO  PURCHASE.  An  executor 
or  administrator  upon  the  estate,  a  freeholder  appointed  to  execute 
a  decree,  or  a  general  or  special  guardian  of  an  infant,  who  has  interest 
in  any  of  the  real  property  to  be  sold,  shall  not,  directly  or  indirectly, 
purchase,  or  be,  or  at  any  time  before  confirmation,  become  interested 
in  a  purchase  at  the  sale ;  except  that  a  guardian  may,  when  authorized 
so  to  do  by  the  order  of  the  surrogate,  purchase,  in  his  name  of  office, 
for  the  benefit  of  his  ward.  A  violation  of  this  section  renders  the 
purchase  void. 

77  ■   ■   . 


Fiduciary  Accounting 

Sect.  2801.  RESTITUTION  FOR  ASSETS  SUBSEQUENTLY 
DISCOVERED.  Where  a  decree  has  been  made  for  the  application 
of  the  proceeds  of  real  property  to  the  payment  of  the  decedent's 
debts,  or  funeral  expenses,  as  prescribed  in  this  title,  and  assets  which 
should  have  been  applied  thereto,  are  afterwards  discovered;  or,  for 
any  other  reason,  money  or  other  personal  property  of  the  decedent, 
which  should  have  been  applied  thereto,  afterwards  comes  to  the 
hands  of  the  executor,  administrator,  legatee  or  next  of  kin,  the 
heir,  devise,  or  other  person  aggrieved  may  maintain  to  procure 
reimbursement  therefrom. 

Sect.  2801a.  CONVEYANCE  OF  REAL  ESTATE  BY  EXEC- 
UTOR AND  ADMINISTRATOR  TO  HOLDER  OF  CONTRACT 
OF  SALE  MADE  BY  DECEDENT.  When  a  person  dies  seized  of 
the  legal  title  to  lands  in  this  state,  and  another  person  claims  to 
hold  the  beneficial  interest  in  an  executory  contract  made  by  the 
decedent  for  the  sale  and  conveyance  of  such  lands  to  the  vendee 
therein  named,  or  to  his  successors  in  interest,  the  execution  and 
delivery  of  a  deed  of  such  real  estate  by  the  executor  or  administrator 
of  the  decedent's  estate,  to  the  holder  of  said  contract,  having  the  effect 
of  conveying  all  of  the  right,  title  and  interest  of  the  decedent  at 
the  time  of  his  death  in  and  to  said  lands,  may  be  authorized  and 
compelled  upon  the  application  of  such  executor  or  administrator, 
upon  the  conditions  and  in  the  manner  hereinafter  provided.  Upon 
receiving  written  notice  of  any  such  claim,  subscribed  by  the  claimant 
and  requesting  that  proceedings  be  instituted  under  the  provisions  of 
this  section,  and  containing  particulars  as  to  the  date  of  the  contract, 
the  amount  of  the  purchase  price,  the  time  or  times  when  instalments 
thereof  were  or  will  become  due  and  payable,  the  sum,  if  any,  admitted 
to  be  still  due  or  unpaid  thereon,  a  description  of  the  lands  in  question 
and  a  statement  of  any  other  condition  applying  to  the  vendee,  the 
executor  or  administrator  may,  in  his  discretion,  apply  to  the  surrogate 
from  whose  court  his  letters  were  issued,  for  an  order  authorizing 
and  directing  him  to  execute  a  deed  of  such  lands  to  the  person 
entitled  thereto  upon  such  terms  as  the  court  may  prescribe.  The 
executor  or  administrator  may,  in  his  discretion,  accept  from  the 
claimant  a  deposit  of  money  to  secure  the  estate  for  any  costs  and 
expenses  of  the  application ;  such  money  to  be  retained  by  the  executor 
or  administrator  to  the  extent  of  any  costs  or  expenses  thus  paid 
or  incurred  only  in  the  event  that  the  claimant  neglects  unreasonably 
to  tender  performance  of  his  part  of  the  contract,  or  to  be  ready 
and  willing  to  perform,  when  requested,  pursuant  to  the  order,  if 
any,  to  be  entered  on  such  application.  The  application  shall  be  by 
petition,  duly  verified,  which  shall  set  forth  the  facts  hereinabove 
provided  to  be  contained  in  said  notice,  and  such  other  facts  in  relation 
to  said  matter  as  may  have  come  to  the  knowledge  of  the  executor 
or  administrator,  together  with  the  names  of  the  decedent's  heirs, 
devisees  and  surviving  husband  or  wife,  if  any,  and  of  all  persons 
claiming  under  them  or  either  of  them,  so  far  as  known,  and  shall 
pray  for  a  citation  to  all  such  heirs,  devisees,  wife,  widow  or  persons, 

78 


Fiduciary  Accounting 

requiring  them  to  show  cause  before  said  surrogate  why  an  order 
should  not  be  entered  authorizing  such  conveyance.  Upon  the  return 
of  such  citation  and  after  hearing  the  proofs  in  support  of  the  petition, 
or  in  opposition  thereto,  the  surrogate  shall  make  such  order  as  justice 
requires.  If  it  is  found  that  the  enforcement  of  said  contract  at  law 
would  be  subject  to  a  valid  defense,  in  favor  of  any  party  to  said 
proceedings,  the  petition  shall  be  dismissed.  If  it  is  found  that  such 
contract  is  valid  and  in  force  and  that  the  vendor  had  not,  in  his 
lifetime,  effectually  conveyed  his  interest  in  said  lands  in  fulfillment 
thereof,  the  order  shall  direct  such  conveyance  to  be  made  by  the 
executor  or  administrator,  upon  receiving  the  balance  of  the  purchase 
price,  when  due,  if  there  be  any  such  unpaid  balance,  which  amount 
shall  be  specified  in  the  order,  or  upon  the  compliance  by  the  claimant 
with  any  other  condition  imposed  on  him  by  the  contract.  Under 
such  order,  if  the  purchase  money  on  the  contract  is  not  due  and  the 
claimant  elects  to  pay  the  whole  amount  thereof,  before  maturity, 
the  executor  or  administrator  shall  receive  the  same  and  shall  there- 
upon execute  and  deliver  the  deed  hereinabove  provided  for.  A 
conveyance  made  in  pursuance  of  such  order  shall  be  binding  on  all 
of  said  persons  in  interest  who  were  duly  cited  in  the  proceeding. 
An  order  dismissing  the  petition  shall  not  prejudice  the  right  of  the 
claimant  under  said  contract  to  a  civil  action  for  specific  performance 
nor  to  any  other  remedy  then  existing  at  law  or  in  equity;  but  the 
delivery  and  acceptance  of  a  deed  of  conveyance  executed  in  pursu- 
ance of  an  order  granted  as  prescribed  in  this  section  shall  be  deemed 
a  complete  fulfillment  of  such  contract.  An  order  directing  a  con- 
veyance under  the  provisions  of  this  section  may  be  enforced,  at 
the  instance  of  the  person  entitled  to  such  conveyance,  by  contempt 
proceedings  in  the  manner  provided  for  the  enforcement  of  a  decree 
under  section  twenty-five  hundred  and  fifty-six  of  this  act,  provided 
it  is  shown  that  such  person  tendered  performance  of  his  part  of 
the  contract,  or  was  ready  and  able  to  perform  when  requested,  within 
a  reasonable  time  after  the  order  was  entered.  Upon  such  a  proceeding, 
costs  and  disbursements  may  be  allowed  and  included  in  the  order, 
payable  from  the  estate,  in  the  sums  specified  in  section  twenty-five 
hundred  and  sixty-one  of  this  act. 

Sect.  2802.  VOLUNTARY  INTERMEDIATE  ACCOUNT.  Any 
trustee  created  by  any  last  will  and  testament,  or  appointed  by  any 
competent  authority  to  execute  any  trust  created  by  such  last  will 
and  testament,  may  at  any  time  file  an  intermediate  account,  and  may 
also  annually  render  and  finally  judicially  settle  his  accounts  before 
the  surrogate  of  the  county  having  jurisdiction  of  the  estate  or  trust, 
in  the  manner  provided  by  law  for  the  final  judicial  settlement  of  the 
accounts  of  executors  and  administrators,  and  may  for  that  purpose 
obtain  and  serve  in  the  same  manner  the  necessary  citations  requiring 
all  persons  interested  to  attend  such  final  settlement;  and  the  decree 
of  the  surrogate  on  such  final  settlement  may  be  appealed  from  in 
the  manner  provided  for  an  appeal   from  a  decree  of  a  surrogate's 

79 


Fiduciary  Accounting 

court  on  the  final  settlement  of  the  accounts  of  an  executor  or  adminis- 
trator, and  the  like  proceedings  shall  be  had  on  such  appeal;  in  all 
such  annual  accounts  of  such  trustees,  the  surrogate  before  whom  such 
accounting  may  be  had  shall  allow  to  the  trustee  or  trustees  the  same 
compensation  for  his  or  their  services,  by  way  of  commission,  as  are 
allowed  by  law  to  executors  and  administrators,  besides  their  just 
and  reasonable  expenses  therein;  and  also  the  additional  allowance 
provided  for  in  section  twenty-five  hundred  and  sixty-two  of  this 
act;  the  decree  of  the  surrogate  on  such  final  annual  settlement  of 
an  account  provided  for  in  this  section,  or  the  final  determination,  decree 
or  judgment  of  the  appellate  tribunal  in  case  of  appeal,  shall  have 
the  same  force  and  effect  as  the  decree  of  judgment  of  any  other 
court  of  competent  jurisdiction  on  the  final  settlement  of  such  ac- 
counts, and  of  the  matters  relating  to  such  trust  which  shall  have  been 
embraced  in  such  accounts,  or  litigated  or  determined  on  such  set- 
tlement. 

Sect.  2803.  COMPULSORY  INTERMEDIATE  ACCOUNT. 
Upon  the  petition  of  a  person  interested,  absolutely  or  contingently, 
in  the  estate  or  fund  in  the  hands  of  a  testamentary  trustee,  or  in 
the  application  thereof,  or  of  the  income  or  other  proceeds  thereof, 
the  surrogate  may,  in  his  discretion,  make,  at  any  time,  an  order 
requiring  a  testamentary  trustee  to  render  an  intermediate  account. 

Sect.  2807.  WHEN  JUDICIAL  SETTLEMENT  COMPELLED. 
In  either  of  the  following  cases,  the  surrogate's  court,  may,  from  time 
to  time,  compel  a  judicial  settlement  of  the  account  of  a  testamentary 
trustee : 

1.  Where  one  year  has  expired,  since  the  will  was  admitted  to 
probate. 

2.  Where  the  trustee  has  been  removed,  or,  for  any  other  reason, 
his  powers  have  ceased. 

3.  Where  the  trusts,  or  one  or  more  distinct  and  separate  trusts, 
created  by  the  terms  of  the  will,  have  been  executed,  or  are  ready 
to  be  executed;  so  that  the  persons  beneficially  interested  are,  by 
the  terms  of  the  will,  or  by  operation  of  law,  entitled  to  receive  any 
money  or  other  personal  property  from  the  trustee. 

Sect.  2810.  JUDICIAL  SETTLEMENT  ON  PETITION  OF 
TRUSTEE.  When  one  year  has  expired  since  the  probate  of  the 
will,  or  when  the  trusts,  or  one  or  more  distinct  and  separate  trusts, 
created  by  the  will,  have  been,  or  are  ready  to  be,  fully  executed,  a 
testamentary  trustee  may  present  to  the  surrogate's  court  a  petition, 
duly  verified,  setting  forth  the  facts,  and  praying  that  his  account 
may  be  judicially  settled;  and  that  all  the  persons  who  are  entitled, 
absolutely  or  contingently,  by  the  terms  of  the  will,  or  by  operation 
of  law,  to  share  in  the  fund,  or  in  the  proceeds  of  property  held  by 
the  petitioner,  as  a  part  of  his  trust,  may  be  cited  to  attend  the  settle- 
ment. Thereupon  the  surrogate  must  issue  a  citation  accordingly. 
Sections  2729,  2730  and  2731  of  this  act  apply  to  the  proceedings  upon  the 
return  of  a  citation  issued  as  prescribed  in  this  section,  and  to  the  testa- 

80 


Fiduciary  Accounting 

mentary  trustee  whose  account  is  to  be  settled.  Any  person,  although 
not  named  in  the  citation,  who  is  beneficially  interested  in  the  estate  or 
fund  which  came  to  the  petitioner's  hands,  or  in  the  proceeds  thereof, 
or  in  the  application  of  that  estate  or  fund,  or  of  the  proceeds  thereof, 
is  entitled  to  appear  upon  the  hearing,  and  thus  make  himself  a  party 
to  the  special  proceedings. 

Sect.  2814.  PETITION  TO  RESIGN  TRUST ;  PROCEEDINGS 
THEREON.  A  testamentary  trustee  may,  at  any  time,  present  to  the 
surrogate's  court  a  written  petition,  duly  verified,  praying  that  his 
account  be  judicially  settled;  that  a  decree  may  thereupon  be  made, 
allowing  him  to  resign  his  trust,  and  discharging  him  accordingly; 
and  that  all  persons  who  are  entitled,  absolutely  or  contingently,  by 
the  terms  of  the  will  or  by  operation  of  law,  to  share  in  the  fund 
or  estate,  or  the  proceeds  of  any  property  held  by  the  petitioner  as  a 
part  of  his  trust,  may  be  cited  to  show  cause  why  such  a  decree  should 
not  be  made.  The  petition  must  set  forth  the  facts  upon  which  the 
application  is  founded;  and  it  must  in  all  other  respects,  conform 
to  a  petition  presented  for  a  judicial  settlement  of  the  account  of 
a  testamentary  trustee,  as  prescribed  in  this  title.  The  surrogate 
may,  in  his  discretion,  entertain  or  decline  to  entertain  the  petition. 
If  he  entertains  it,  the  proceeding  must  be,  in  all  respects,  the  same 
as  upon  a  petition  for  a  judicial  settlement  of  the  petitioner's  account, 
except  that,  upon  the  hearing,  the  surrogate  must  first  determine 
whether  sufficient  reasons  exist  for  granting  the  prayer  of  the  peti- 
tion; and  if  he  determines  that  they  exist,  he  must  make  an  order 
accordingly,  and  allowing  the  petitioner  to  account,  for  the  purpose 
of  being  discharged.  Upon  the  petitioner's  fully  accounting,  and  paying 
all  money  belonging  to  the  trust,  and  delivering  all  books,  papers,  and 
other  property  of  the  trust,  in  his  hands,  either  into  the  surrogate's 
court,  or  as  the  surrogate  directs,  a  decree  may  be  made,  accepting  his 
resignation  and  discharging  him  accordingly. 

Sect.  2815.  PETITION  TO  REQUIRE  SECURITY  FROM 
TESTAMENTARY  TRUSTEE.  Any  person,  beneficially  interested  in 
the  execution  of  the  trust,  may  present  to  the  surrogate's  court  a  written 
petition,  duly  verified,  setting  forth,  either  upon  his  knowledge,  or 
upon  his  information  and  belief,  any  fact,  respecting  a  testamentary 
trustee,  the  existence  of  which,  if  it  was  interposed  as  an  objection 
to  granting  letters  testamentary  to  a  person  named  as  executor  in 
a  will,  would  make  it  necessary  for  such  a  person  to  give  security, 
in  order  to  entitle  himself  to  letters ;  and  praying  for  a  decree,  directing 
the  testamentary  trustee  to  give  security  for  the  performance  of  his 
trust;  and  that  he  may  be  cited  to  show  cause,  why  such  a  decree 
should  not  be  made.  Upon  the  presentation  of  such  a  petition,  the 
surrogate  must  issue  a  citation  accordingly.  Upon  the  return  of  the 
citation,  a  decree,  requiring  the  testamentary  trustee  to  give  such 
security,  may  be  made  in  a  case  where  a  person  so  named  as  executor 
can  entitle  himself  to  letters  testamentary,  only  by  giving  a  bond;  but 
not  otherwise. 

8i 


Fiduciary  Accounting 

Sect.  2817.  REMOVAL  OF  TESTAMENTARY  TRUSTEE.  In 
either  of  the  following  cases,  a  person  beneficially  interested  in  the 
execution  of  the  trust,  may  present  to  the  surrogate's  court  a  written 
petition,  duly  verified,  setting  forth  the  facts,  and  praying  for  a  decree 
removing  a  testamentary  trustee  from  his  trust;  and  that  he  may 
be  cited  to  show  cause,  why  such  a  decree  should  not  be  made : 

1.  Where,  if  he  was  named  in  a  will  as  executor,  letters  testa- 
mentary would  not  be  issued  to  him,  by  reason  of  his  personal  dis- 
qualification or  incompetency. 

2.  Where,  by  reason  of  his  having  wasted  or  improperly  applied 
the  money  or  other  property  in  his  charge,  or  invested  money  in 
securities  unauthorized  by  law,  or  otherwise  improvidently  managed 
or  injured  the  property  committed  to  his  charge,  or  by  reason  of  other 
misconduct  in  the  execution  of  his  trust,  or  dishonesty,  drunkenness, 
improvidence,  or  want  of  understanding,  he  is  unfit  for  the  due  execu- 
tion of  his  trust. 

3.  Where  he  has  failed  to  give  a  bond,  as  required  by  a  decree, 
made  as  prescribed  in  the  last  two  sections;  or  has  wilfully  refused, 
or  without  good  cause  neglected,  to  obey,  a  direction  of  the  surrogate, 
contained  in  any  other  decree,  or  in  an  order  made  as  prescribed  in 
this  title;  or  any  provision  of  law,  relating  to  the  discharge  of  his 
duty. 

Sect.  2818.  APPOINTMENT  OF  SUCCESSOR.  When  a  per- 
son named  in  a  will  as  sole  testamentary  trustee  dies  prior  to  the 
probate  of  the  will,  or  by  an  instrument  in  writing,  renounces  his 
appointment,  or  when,  a  sole  testamentary  trustee  dies,  or  becomes  a 
lunatic,  or  is  by  a  decree  of  the  surrogate's  court  removed  or  allowed 
to  resign,  and  the  trust  has  not  been  fully  executed,  the  same  court 
may  appoint  his  successor,  unless  such  appointment  would  contravene 
the  express  terms  of  the  will.  Where  one  of  two  or  more  persons 
named  in  a  will  as  testamentary  trustees  dies  prior  to  the  probate  of 
the  will,  or  by  an  instrument  in  writing,  renounces  his  or  their  appoint- 
ment, or  where  one  of  two  or  more  testamentary  trustees  dies  or 
becomes  a  lunatic,  or  is  by  a  decree  of  the  surrogate's  court  removed 
or  allowed  to  resign,  a  successor  shall  not  be  appointed,  except  where 
such  appointment  is  necessary  in  order  to  comply  with  the  express 
terms  of  the  will,  or  unless  the  same  court,  or  the  supreme  court, 
shall  be  of  the  opinion  that  the  appointment  of  a  successor  would 
be  for  the  benefit  of  the  cestui  que  trust.  Unless  and  until  a  successor 
is  appointed  the  remaining  trustee  or  trustees  may  proceed  and  execute 
the  trust  as  fully  as  if  such  trustee  (or  trustees)  had  not  died,  re- 
nounced, become  a  lunatic,  been  removed  or  resigned.  Where  a 
decree  removing  a  trustee  or  discharging  him  upon  his  resignation 
does  not  designate  his  successor,  or  the  person  designated  therein  does 
not  qualify,  the  successor  must  be  appointed  and  must  qualify  in  the 
manner  prescribed  by  law  for  the  appointment  and  qualification  of  an 
administrator  with  the  will  annexed. 

Sect.    2819.     PROCEEDINGS   WHERE   TRUSTEE  IS   ALSO 

82 


Fiduciary  Accounting 

EXECUTOR.  Where  the  same  person  is  a  testamentary  trustee,  and 
also  the  executor  of  the  will,  or  an  administrator  upon  the  same  estate, 
proceedings  taken  by  or  against  him,  as  prescribed  in  this  title,  do 
not  affect  him  as  executor  or  administrator,  or  the  creditors  of,  or 
persons  interested  in,  the  general  estate,  except  in  one  of  the  following 
cases : 

1.  Where  he  presents  a  petition,  praying  for  the  revocation  of 
his  letters,  he  may  also,  in  the  same  petition,  set  forth  the  facts,  upon 
showing  which  he  would  be  allowed  to  resign  as  testamentary  trustee ; 
and  may  thereupon  pray  for  a  decree  allowing  him  so  to  resign, 
and  for  a  citation  accordingly. 

2.  Where  a  person  presents  a  petition,  praying  for  the  revocation 
of  letters  issued  to  an  executor  or  administrator;  and  any  of  the 
facts  set  forth  in  the  petition  are  made,  by  the  provisions  of  this  title, 
sufficient  to  entitle  the  same  person  to  present  a  petition,  praying  for 
the  removal  of  a  testamentary  trustee;  the  petitioner  may  pray  for 
a  decree,  removing  the  person  complained  of  in  both  capacities,  and 
for  a  citation  accordingly. 

In  either  case,  proceedings  upon  the  petition  for  the  resignation 
or  removal,  as  the  case  requires,  of  the  testamentary  trustee,  and 
for  the  judicial  settlement  of  his  account,  may  be  taken,  as  prescribed 
in  this  title,  in  connection  with,  or  separately  from,  the  like  pro- 
ceedings upon  the  petition  for  the  revocation  of  the  letters,  as  the 
surrogate   directs. 

Sect.  2822.  PETITION  FOR  APPOINTMENT  BY  INFANT 
OVER  FOURTEEN.  In  either  of  the  following  cases,  an  infant  of 
the  age  of  fourteen  years  or  upwards,  may  present,  to  the  surrogate's 
court  of  the  county  in  which  he  resides ;  or,  if  he  is  not  a  resident  of 
the  state,  to  the  surrogate's  court  of  the  county  in  which  any  of  his 
property,  real  or  personal,  is  situated ;  a  written  petition,  duly  verified, 
setting  forth  the  facts  upon  which  the  jurisdiction  of  the  court  de- 
pends, and  praying  for  a  decree  appointing  a  general  guardian,  either 
of  his  person,  or  of  his  property,  or  both,  as  the  case  requires;  and, 
if  necessary,  that  the  persons,  entitled  by  law  to  be  cited  upon  such 
an  application,  may  be  cited  to  show  cause,  why  such  a  decree  should 
not  be  made: 

1.  Where  such  a  general  guardian  has  not  been  duly  appointed, 
either  by  a  court  of  competent  jurisdiction  of  the  state  or  by  the  will 
or  deed  of  his  father  or  mother,  admitted  to  probate  or  authenticated, 
and  recorded,  as  prescribed  in  section  twenty-eight  hundred  and  fifty- 
one  of  this  act. 

2.  Where  a  general  guardian  so  appointed  has  died,  become  in- 
competent or  disqualified;  or  refuses  to  act;  or  has  been  removed;  or 
where  his  term  of  office  has  expired.  Where  the  petitioner  is  a  non- 
resident married  woman,  and  the  petition  relates  to  personal  property 
only,  it  must  affirmatively  show  that  the  property  is  not  subject  to 
the  control  or  disposition  of  her  husband,  by  the  law  of  the  petitioner's 
residence.     Where  an  infant  in  one  of  the  cases   mentioned  in   this. 

83 


Fiduciary  Accounting 

section  has  refused,  or  for  ten  days  has  failed,  to  present  the  petition, 
the  surrogate,  upon  notice  to  be  given  in  such  manner  as  he  shall 
direct,  to  the  infant  and  the  persons  who  would  be  entitled  by  law 
to  be  cited  upon  the  application  of  the  infant,  shall  proceed  to  the 
appointment  of  a  general  guardian  of  the  property  of  the  infant  in 
the  same  manner  as  if  the  infant  had  duly  presented  the  petition. 

Sect.  2823.  CONTENTS  OF  PETITION;  CITATION.  A  peti- 
tion, presented  as  prescribed  in  the  last  section,  must  also  state  whether 
or  not  the  father  and  mother  of  the  petitioner  are  known  to  be  living. 
If  either  of  them  is  known  to  be  living,  and  the  petition  does  not 
pray  that  the  father,  or,  if  he  is  dead,  that  the  mother,  may  be  ap- 
pointed the  general  guardian,  it  must  set  forth  the  circumstances  which 
render  the  appointment  of  another  person  expedient;  and  must  pray 
that  the  father,  or,  if  he  is  dead,  that  the  mother  of  the  petitioner 
may  be  cited  to  show  cause,  why  the  decree  should  not  be  made.  A 
citation,  issued  to  the  father  of  the  petitioner,  must  be  served  at  least 
ten  days  before  it  is  returnable.  Where  the  case  is  within  subdivision 
second  of  the  last  section,  the  petition  must  pray  that  the  person 
formerly  appointed  general  guardian  may  be  cited,  unless  it  is  shown 
that  he  is  dead.  The  surrogate  must  inquire,  and  ascertain  as  far 
as  practicable,  what  relatives  of  the  infant  reside  in  his  county;  and  he 
may,  in  his  discretion,  cite  any  relative  or  class  of  relatives  of  the 
infant,  residing  in  that  county  or  elsewhere,  to  show  cause  why  the 
prayer  of  the  petition  should  not  be  granted. 

Sect.  2825.  SURROGATE'S  INQUIRY;  APPOINTMENT  OF 
GUARDIAN.  Upon  the  return  of  the  citation,  the  surrogate  must 
make  such  a  decree  in  the  premises,  as  justice  requires.  He  may,  in 
his  discretion,  hear  allegations  and  proofs  from  a  person  not  a  party. 
Where  a  citation  is  not  issued,  the  surrogate  must,  upon  the  presenta- 
tion of  the  petition,  inquire  into  the  circumstances.  For  the  purpose 
of  such  an  inquiry,  or  of  an  inquiry  into  the  amount  of  security  to  be 
required  of  the  guardian,  he  may  issue  a  subpoena,  requiring  any  person 
to  attend  before  him,  to  testify  respecting  any  matter  involved  therein. 
If  he  is  satisfied  that  the  allegations  of  the  petition  are  true  in  fact, 
and  that  the  interests  of  the  infant  will  be  promoted  by  the  appoint- 
ment of  a  general  guardian,  either  of  his  person  or  of  his  property, 
he  must  make  a  decree  accordingly,  except  that  a  guardian  of  the 
person  of  a  married  woman  shall  not  be  appointed.  In  a  proper  case 
he  may  appoint  a  general  guardian  in  one  capacity,  without  a  citation; 
and  issue  a  citation,  to  show  cause  against  the  appointment  of  a  general 
guardian,  in  the  other  capacity. 

Sect.  2827.  APPOINTMENT  OF  TEMPORARY  GUARDIAN 
FOR  INFANT  UNDER  FOURTEEN.  A  relative  of  an  infant  under 
fourteen  years  of  age,  or  any  other  person  in  behalf  of  such  infant, 
may  present  to  the  surrogate's  court  of  the  county  in  which  the 
infant  resides ;  or,  if  he  is  not  a  resident  of  the  state,  to  the  surrogate's 
court  of  the  county  in  which  any  of  the  infant's  property,  real  or 
personal,  is  situated;  a  written  petition,  duly  verified,  setting  forth  the 

84 


Fiduciary  Accounting 

facts,  upon  which  the  jurisdiction  of  the  court  depends,  and  praying 
for  a  decree  appointing  a  guardian  of  the  person,  or  of  the  property,  or 
both,  of  the  infant,  to  serve  until  the  infant  attains  the  age  of  fourteen 
years,  and  a  successor  to  the  guardian  is  appointed.  The  cases  in 
which  such  a  guardian  may  be  appointed,  the  contents  of  the  petition, 
and  the  proceedings  thereupon  are  the  same,  as  prescribed  in  the  fore- 
going sections  of  this  article,  with  respect  to  the  appointment  of  a 
general  guardian,  upon  the  petition  of  an  infant  of  the  age  of  fourteen 
years  or  upwards;  except  that  the  surrogate  must  nominate,  as  well  as 
appoint,  the  temporary  guardian. 

Sect.  2828.  TERM  OF  OFFICE  OF  TEMPORARY  GUARDIAN. 
The  term  of  office  of  a  guardian,  appointed  as  prescribed  in  the  last 
section,  expires  when  the  infant  attains  the  age  of  fourteen  years. 
But  after  the  infant  attains  that  age,  the  person  so  appointed  continues 
to  retain  all  the  powers  and  authority,  and  is  subject  to  all  the  duties 
and  liabilities,  of  a  guardian  of  the  person,  or  of  the  property,  or 
both,  pursuant  to  his  letters ;  until  his  successor  is  appointed  and  has 
qualified,  or  until  his  letters  are  revoked,  for  some  other  cause,  by 
the  decree  of  the  surrogate's  court;  and  his  sureties  are  responsible 
accordingly. 

Sect.  2830.  QUALIFICATION  OF  A  GUARDIAN  OF  PROP- 
ERTY ;  BOND.  Before  letters  of  guardianship  of  an  infant's  property 
are  issued  by  the  surrogate's  court,  the  person  appointed  must,  besides 
taking  an  official  oath,  as  prescribed  by  law,  execute  to  the  infant,  and 
file  with  the  surrogate,  his  bond  with  at  least  two  sureties,  in  a  penalty 
fixed,  by  the  surrogate,  not  less  than  twice  the  value  of  the  personal 
property,  and  of  the  rents  and  profits  of  the  real  property;  conditioned 
that  the  guardian  will,  in  all  things,  faithfully  discharge  the  trust 
reposed  in  him,  and  obey  all  lawful  directions  of  the  surrogate  touching 
the  trust,  and  that  he  will,  in  all  respects,  render  a  just  and  true 
account  of  all  money  and  other  property  received  by  him,  and  of  the 
application  thereof,  and  of  his  guardianship,  whenever  he  is  required 
so  to  do,  by  a  court  of  competent  jurisdiction.  But  the  surrogate 
may,  in  his  discretion,  limit  the  amount  of  the  bond  to  not  less  than 
twice  the  value  of  the  personal  property,  and  of  the  rents  and  profits 
of  the  real  property  for  the  term  of  three  years.  But  in  case  where 
it  appears  to  be  impracticable  to  give  a  bond  sufficient  to  cover  the 
whole  amount  of  the  infant's  personal  property,  the  surrogate  may, 
in  his  discretion,  accept  security,  to  be  approved  by  the  surrogate, 
not  less  than  twice  the  amount  of  the  particular  portion  of  the 
infant's  property  which  the  guardian  will  be  authorized  under  the 
letters  to  receive;  and  issue  letters  thereon  limited  to  the  receiving 
and  administering  only  such  personal  property  for  which  double  the 
security  has  been  given,  and  restraining  the  guardian  from  receiving 
any  other  personal  property  of  the  infant  until  the  further  order 
of  the  surrogate  on  additional  further  satisfactory  security. 

Sect.  2831.    QUALIFICATION  OF  GUARDIAN  OF  PERSON. 
BOND.     Before   letters   of   guardianship   of   an   infant's   person   are 

85 


Fiduciary  Accounting 

issued  by  the  surrogate's  court,  the  person  appointed  must  take  the 
official  oath,  as  prescribed  by  law.  The  surrogate  may  also  require 
him  to  execute  to  the  infant  a  bond,  in  a  penalty  fixed  by  the  surro- 
gate, and  with  or  without  sureties,  as  to  the  surrogate  seems  proper; 
conditioned,  that  the  guardian  will  in  all  things  faithfully  discharge  the 
trust  reposed  in  him,  and  duly  account  for  all  money  or  other  property 
which  may  come  to  his  hands,  as  directed  by  the  surrogate's  court. 

Sect.  2832.  WHEN  GUARDIAN'S  LETTER  REVOKED.  In 
either  of  the  following  cases,  the  ward,  or  any  relative  or  other  person 
in  his  behalf,  or  the  surety  of  a  guardian,  may,  at  any  time,  present 
to  the  surrogate's  court  a  written  petition,  duly  verified,  setting  forth 
the  facts,  and  praying  for  a  decree,  revoking  letters  of  guardianship, 
either  of  the  person,  or  of  the  property,  or  both ;  and  that  the  guardian 
complained  of  may  be  cited  to  show  cause,  why  such  a  decree  should 
not  be  made : 

1.  Where  the  guardian  is  disqualified  by  law,  or  is,  for  any  reason, 
incompetent  to  fulfill  his  trust. 

2.  Where  by  reason  of  his  having  wasted  or  improperly  applied 
the  money  or  other  property  in  his  charge,  or  invested  money  in 
securities  unauthorized  by  law,  or  otherwise  improvidently  managed 
or  injured  the  real  or  personal  property  of  the  ward,  or  by  reason 
of  other  misconduct  in  the  execution  of  his  office,  or  his  dishonesty, 
drunkenness,  improvidence,  or  want  of  understanding,  he  is  unfit  for 
the  due  execution   of  his   office. 

3.  Where  he  has  wilfully  refused,  or,  without  good  cause,  neglected, 
to  obey  any  lawful  direction  of  the  surrogate,  contained  in  a  decree 
or  an  order;  or  any  provision  of  law,  relating  to  the  discharge  of  his 
duty. 

4.  Where  the  grant  of  letters  to  him  was  obtained  by  a  false 
suggestion  of  a  material  fact. 

5.  Where  he  has  removed,  or  is  about  to  remove,  from  the 
state. 

6.  In  the  case  of  the  guardian  of  the  person,  where  the  infant's 
welfare  will  be  promoted  by  the  appointment  of  another  guardian. 

Sect.  2842.  GUARDIAN  MUST  FILE  ANNUAL  INVENTORY 
AND  ACCOUNT.  A  general  guardian  of  an  infant's  property,  ap- 
pointed by  a  surrogate's  court,  must,  in  the  month  of  January  of 
each  year,  as  long  as  any  of  the  infant's  property,  or  of  the  proceeds 
thereof,  remains  under  his  control,  file  in  the  surrogate's  court  the 
following  papers : 

I.  An  inventory,  containing  a  full  and  true  statement  and  descrip- 
tion of  each  article  or  item  of  personal  property  of  his  ward,  received 
by  him,  since  his  appointment,  or  since  the  filing  of  the  last  annual 
inventory,  as  the  case  requires;  the  value  of  each  article  or  item  so 
received;  a  list  of  the  articles  or  items,  remaining  in  his  hands;  a 
statement  of  the  manner  in  which  he  has  disposed  of  each  article  or 
item,  not  remaining  in  his  hands;  and  a  full  description  of  the  amount 
and  nature  of  each  investment  of  money,  made  by  him. 

86 


Fiduciary  Accounting 

2.  A  full  and  true  account,  in  form  of  debtor  and  creditor,  of 
all  his  receopts  and  disbursements  of  money,  during  the  preceding 
year;  in  which  he  must  charge  himself  with  any  balance  remaining 
in  his  hands,  when  the  last  account  was  rendered,  and  must  distinctly 
state  the  amount  of  the  balance  remaining  in  his  hands,  at  the  conclu- 
sion of  the  year,  to  be  charged  to  him  in  the  next  year's  account. 

Sect.  2844.  ANNUAL  EXAMINATION  OF  GUARDIAN'S 
ACCOUNTS.  In  the  month  of  February  of  each  year  and  thereafter 
until  completed,  the  surrogate  must,  for  the  purposes  specified  in 
the  next  section,  examine,  or  cause  to  be  examined,  under  his  direc- 
tion, all  inventories  and  accounts  of  guardians  filed  since  the  first 
day  of  February  of  the  preceding  year.  The  examination  may  be  made 
by  the  clerk  of  the  surrogate's  court,  or  by  a  person  specially  appointed 
by  the  surrogate  to  make  it,  who  must,  before  he  enters  upon  the 
examination,  subscribe  and  take  before  the  surrogate,  and  file  with 
the  clerk  of  the  surrogate's  court,  an  oath  faithfully  to  execute  his 
duties,  and  to  make  a  true  report  to  the  surrogate.  Where  the  surro- 
gate seasonably  certifies  in  writing  to  the  board  of  supervisors,  or, 
in  the  county  of  New  York,  to  the  board  of  aldermen,  that  the  exam- 
ination required  by  this  section  cannot  be  made  by  him,  or  by  the 
clerk  of  the  surrogate's  court,  or  by  any  clerk  employed  in  his  office 
and  paid  by  the  county,  the  board  must  provide  for  the  compensation 
of  a  suitable  person  to  make  the  examination. 

Sect.  2845.  PROCEEDINGS  WHEN  ACCOUNTS  ARE  DE- 
FECTIVE OR  NOT  FILED.  If  it  appears  to  the  surrogate,  upon 
an  examination  made  as  prescribed  in  the  last  section,  that  a  general 
guardian  of  an  infant's  property,  appointed  by  letters  issued  from 
his  court,  has  omitted  to  file  his  annual  inventory  or  account,  or  the 
affidavit  relating  thereto,  as  prescribed  in  the  last  section  but  one; 
or  if  the  surrogate  is  of  the  opinion,  that  the  interest  of  the  ward 
requires  that  the  guardian  should  render  a  more  full  or  satisfactory 
inventory  or  account;  the  surrogate  must  make  an  order,  requiring 
the  guardian  to  supply  the  deficiency;  and  also,  in  his  discretion, 
requiring  the  guardian  personally  to  pay  the  expense  of  serving 
the  order  upon  him.  Where  the  guardian  fails  to  comply  with 
such  an  order,  within  three  months  after  it  is  made;  or  where 
the  surrogate  has  reason  to  believe  that  sufficient  cause  exists  for 
the  guardian's  removal,  the  surrogate  may,  in  his  discretion,  appoint 
a  fit  and  proper  person  special  guardian  of  the  ward,  for  the  purpose 
of  filing  a  petition  in  his  behalf,  for  the  removal  of  the  guardian  and 
prosecuting  the  necessary  proceedings  for  the  purpose. 

Sect.  2847.  WHEN  SETTLEMENT  OF  GUARDIAN'S  AC- 
COUNTS COMPELLED.  A  written  petition,  duly  verified,  praying 
for  the  judicial  settlement  of  the  account  of  a  general  guardian  of 
an  infant's  property,  and  that  he  may  be  cited  to  attend  the  settlement 
thereof,  may  be  presented  to  the  surrogate's  court  in  either  of  the 
following  cases: 

I.     By  the  ward,  after  he  has  attained  his  majority. 

87 


Fiduciary  Accounting 

2.  By  the  executor  or  administrator  of  a  ward,  who  has  died. 

3.  By  the  guardian's  successor,  including  a  guardian  appointed 
after  the  reversal  of  a  decree,  appointing  the  person  so  required  to 
account. 

4.  By  a  surety  in  the  official  bond  of  a  guardian  whose  letters 
have  been  revoked;  or  by  the  legal  representative  of  such  surety. 
Citation  under  this  subdivision  must  be  directed  to  both  the  guardian 
and  the  ward. 

Sect.  2850.  CITATION  AND  PROCEEDINGS  ON  SETTLE- 
MENT OE  ACCOUNTS.  Upon  the  presentation  of  a  petition,  as 
prescribed  in  either  of  the  last  three  sections,  the  surrogate  must  issue 
a  citation  accordingly.  Section  two  thousand  seven  hundred  and 
twenty-seven,  sections  two  thousand  seven  hundred  and  thirty-three 
to  two  thousand  seven  hundred  and  thirty-seven,  both  inclusive,  and 
sections  two  thousand  seven  hundred  and  forty-one  and  two  thousand 
seven  hundred  and  forty-four,  of  this  act,  apply  to  a  guardian  account- 
ing as  prescribed  in  this  article,  and  regulate  the  proceedings  upon 
such  an  accounting.  The  accounting  party  must  annex  to  every 
account  produced  and  filed  by  him  an  affidavit,  in  the  form  prescribed 
in  this  article  for  the  affidavit  to  be  annexed  by  him  to  his  annual 
inventory  and  account.  A  guardian  designated  in  this  title  is  entitled 
to  the  same  compensation  as  an  executor  or  administrator. 

Sect.  2851.  APPOINTMENT  OE  TESTAMENTARY  GUAR- 
DIAN TO  BE  PROVED.  A  person  shall  not  exercise,  within  the 
state,  any  power  of  authority,  as  guardian  of  the  person  or  property 
of  an  infant,  by  virtue  of  an  appointment  contained  in  the  will  of  the 
infant's  father  or  mother,  being  a  resident  of  the  state,  and  dying 
after  this  chapter  takes  effect,  unless  the  will  has  been  duly  admitted 
to  probate,  and  recorded  in  the  proper  surrogate's  court,  and  letters 
of  guardianship  have  been  issued  to  him  thereupon;  or  by  virtue  of 
an  appointment  contained  in  a  deed  of  the  infant's  father  or  mother, 
being  a  resident  of  the  state,  executed  after  this  chapter  takes  effect, 
unless  the  deed  has  been  acknowledged  or  proved,  and  certified,  so  as 
to  entitle  it  to  be  recorded,  and  has  been  recorded  in  the  office  for 
recording  deeds  in  the  county,  in  which  the  person  making  the  appoint- 
ment resided,  at  the  time  of  the  execution  thereof.  Where  a  deed 
containing  such  an  appointment  is  not  recorded,  within  three  months 
after  the  death  of  the  grantor,  the  person  appointed  is  presumed  to 
have  renounced  the  appointment;  and  if  a  guardian  is  afterwards 
duly  appointed  by  a  surrogate's  court,  the  presumption  is  conclusive. 

Sect.  2852.  QUALIFICATION  AND  LETTERS  OF  TESTA- 
MENTARY GUARDIAN;  OBJECTIONS;  RENUNQATION. 
Where  a  will,  containing  the  appointment  of  a  guardian,  is  admitted 
to  probate,  the  person  appointed  guardian  must,  within  thirty  days 
thereafter,  qualify  as  prescribed  in  section  2594  of  this  act;  otherwise 
he  is  deemed  to  have  renounced  the  appointment.  But  the  surrogate 
may  extend  the  time  so  to  qualify,  upon  good  cause  shown,  for  not 
more   than   three   months.     And   any   person   interested   in  the   estate 


Fiduciary  Accounting 

may,  before  letters  of  guardianship  are  issued,  file  an  affidavit  setting 
forth  with  respect  to  the  guardian  so  appointed,  any  fact  which  is 
made  by  law  an  objection  to  the  issuing  of  letters  testamentary  to 
an  executor.  Sections  2636  to  2638  of  this  act,  both  inclusive,  apply 
to  such  an  affidavit  and  to  the  proceedings  thereupon.  A  person 
appointed  guardian  by  will  may,  at  any  time  before  he  qualifies,  renounce 
the  appointment  by  a  written  instrument,  under  his  hand,  filed  in  the 
surrogate's  office. 

Sect.  2853.  SECURITY  FROM  TESTAMENTARY  GUAR- 
DIAN. Where  a  guardian  of  an  infant's  person  or  property  has  been 
appointed  by  will  or  by  deed,  the  infant,  or  any  relative  or  other 
person,  in  his  behalf,  may  present,  to  the  surrogate's  court  in  which 
the  will  was  admitted  to  probate;  or  to  the  surrogate's  court  of  the 
county  in  which  the  deed  was  recorded;  a  written  petition,  duly 
verified,  setting  forth,  either  upon  his  knowledge,  or  upon  his  informa- 
tion and  belief,  any  fact,  respecting  the  guardian,  the  existence  of 
which,  if  it  was  interposed  as  an  objection  to  granting  letters  testa- 
mentary to  a  person  named  as  executor  in  a  will,  would  make  it 
necessary  for  such  a  person  to  give  a  bond,  in  order  to  entitle  himself 
to  letters;  and  praying  for  a  decree,  requiring  the  guardian  to  give 
security  for  the  performance  of  his  trust;  and  that  he  may  be  cited 
to  show  cause  why  such  a  decree  should  not  be  made.  Upon  presen- 
tation of  such  a  petition,  and  proof  of  the  facts  therein  alleged,  to  the 
satisfaction  of  the  surrogate,  he  must  issue  a  citation  accordingly. 
Upon  the  return  of  the  citation,  a  decree  requiring  the  guardian  to 
give  security  may  be  made,  in  the  discretion  of  the  surrogate,  in  a 
case  where  a  person  so  named  as  executor,  can  entitle  himself  to 
letters  testamentary  only  by  giving  a  bond;  but  not  otherwise. 

Sect.  2858.  REMOVAL  OF  GUARDIAN.  Upon  the  petition 
of  the  ward,  or  of  any  relative  or  other  person,  in  his  behalf,  the 
surrogate's  court,  having  jurisdiction  to  require  security  from  a  guar- 
dian appointed  by  will  or  by  deed  may  remove  such  a  guardian,  in 
any  case  where  a  testamentary  trustee  may  be  removed,  as  prescribed 
in  title  sixth  of  this  chapter;  and  the  proceedings  upon  such  a  petition 
are  the  same,  as  prescribed  in  that  title  for  the  removal  of  a  testa- 
mentary trustee.  Where  a  citation  is  issued,  upon  a  petition  for  the 
removal  of  such  a  guardian,  he  may  be  suspended  from  the  exercise 
of  his  powers  and  authority,  as  if  he  had  been  appointed  by  the  surro- 
gate's court. 

Sect.  2859.  RESIGNATION  OF  GUARDIAN.  A  guardian  ap- 
pointed by  will  or  by  deed,  may  be  allowed  to  resign  his  trust,  by  the 
surrogate's  court,  having  jurisdiction  to  require  security  from  him. 
The  proceedings  for  that  purpose,  and  the  effect  of  a  decree  made 
thereupon,  are  the  same,  as  where  a  guardian  appointed  by  the  surro- 
gate's court  presents  a  petition,  praying  that  his  letters  may  be  revoked, 
as  prescribed  in  article  first  of  this  title. 

Sect.  2860.  APPOINTMENT  OF  SUCCESSOR-  Where  a  sole 
guardian,  appointed  by  will  or  by  deed,  has  been,  by  the  decree  of 

89 


Fiduciary  Accounting 

the  surrogate's  court  removed  or  allowed  to  resign,  a  successor  may 
be  appointed  by  the  same  court,  with  the  effect  prescribed  in  section 
2605  of  this  act;  unless  such  an  appointment  would  contravene  the 
express  terms  of  the  will  or  deed. 

Sect.  3246.  COSTS  IN  ACTIONS  BY  AND  AGAINST  EXECU- 
TORS, TRUSTEES,  ETC.  In  an  action,  brought  by  or  against  an 
executor  or  administrator,  in  his  representative  capacity,  or  the  trustee 
of  an  express  trust,  or  a  person  expressly  authorized  by  statute  to  sue 
or  to  be  used,  costs  must  be  awarded,  as  in  an  action  by  or  against 
a  person,  prosecuting  or  defending  in  his  own  right,  except  as  other- 
wise prescribed  in  sections  1835  and  1836  of  this  act;  but  they  are 
exclusively  chargeable  upon,  and  collectible  from  the  estate,  fund, 
or  person  represented,  unless  the  court  directs  them  to  be  paid,  by 
the  party  personally,  for  mismanagement  or  bad  faith  in  the  prosecution 
or  defense  of  the  action. 

Sect.  3320.  RECEIVERS'  COMMISSIONS ;  COST  OF  BONDS  ; 
TRUSTEES'  COMMISSIONS.  A  receiver,  except  as  otherwise  spe- 
cially prescribed  by  statute,  is  entitled,  in  addition  to  his  necessary 
expenses,  to  such  commissions,  not  exceeding  five  per  centum  upon 
the  sums  received  and  disbursed  by  him,  as  the  court  by  which,  or  the 
judge  by  whom,  he  is  appointed  allows.  But  if  in  any  case  the  com- 
missions of  a  temporary  or  permanent  receiver,  so  computed,  shall 
not  amount  to  one  hundred  dollars,  said  court  or  judge  may,  in  its 
or  his  discretion,  allow  said  receiver  such  a  sum,  not  exceeding  one 
hundred  dollars,  for  his  commissions  as  shall  commensurate  with 
the  services  rendered  by  said  receiver.  Any  receiver,  assignee,  guar- 
dian, trustee,  committee,  executor,  administrator  or  person  appointed 
under  section  one  hundred  and  eleven  of  the  real  property  law  or 
under  section  twenty  of  the  personal  property  law,  required  by  law 
to  give  a  bond  as  such  may  include  as  a  part  of  his  necessary  expenses, 
such  reasonable  sum,  not  exceeding  one  per  centum  per  annum  upon 
the  amount  of  such  bond  paid  his  surety  thereon,  as  such  court  or 
judge  allows.  A  trustee  of  an  express  trust  is  entitled,  and  two  or 
more  trustees  of  such  a  trust  are  entitled,  to  be  apportioned  between 
or  among  them  according  to  the  services  rendered  by  them  respectively, 
as  compensation  for  services  as  such,  over  and  above  expenses,  to 
commissions  as  follows :  For  receiving  and  paying  out  all  sums 
of  principal  not  exceeding  one  thousand  dollars,  at  the  rate  of  five 
per  centum.  For  receiving  and  paying  out  any  additional  sums  of 
principal  not  exceeding  ten  thousand  dollars,  at  the  rate  of  two 
and  one-half  per  centum.  For  receiving  and  paying  out  all  sums  of 
principal  over  eleven  thousand  dollars,  at  the  rate  of  one  per  centum. 
And  for  receiving  and  paying  out  income  in  each  year,  at  the  like  rates. 
In  all  cases  a  just  and  reasonable  allowance  must  be  made  for  the 
necessary  expenses  actually  paid  by  such  trustee  or  trustees.  If  the 
value  of  the  principal  of  the  trust  estate  or  fund  equals  or  exceeds 
one  hundred  thousand  dollars,  each  such  trustee  is  entitled  to  the  full 
commission  on  principal,  and  on  income  for  each  year,  to  which  a  sole 

90 


Fiduciary  Accounting 

trustee  is  entitled,  unless  the  trustees  are  more  than  three,  in  which 
case  three  full  commissions  at  the  rates  aforesaid  must  be  apportioned 
between  or  among  them,  according  to  the  services  rendered  by  them 
respectively.  If  the  instrument  creating  the  trust  provides  specific 
compensation  for  the  services  of  the  trustee  or  trustees,  no  other 
compensation  for  such  services  shall  be  allowed  unless  the  trustee  or 
trustees  shall,  before  receiving  any  compensation  for  such  services, 
by  a  written  instrument  duly  acknowledged,  renounce  such  specific 
compensation. 


91 


Fidu ciary  Accou nting 


COLLATERAL  READING 

The  following  is  a  list  of  books  on  the  general  subject,  recom- 
mended to  the  student  who  desires  to  pursue  an  intensive  course  of 
reading;  the  student  must,  however,  remember  that  editions  not  of 
recent  publication  must  be  read  in  the  light  of  subsequent  changes  in 
the  law  and  practice: 


AUTHOR 

Baugh,  F.  H.,  and 
Schmeisser,  W.  E. 

Fowler,  R.  P. 

Gottsberger,  F. 

Hardcastle,  Joseph, 

Heaton,  W.  C. 

Hill,  F.  T. 
Hoes,  E.  A.,  Jr. 

Jessup,  H.  W. 

Loring,  A.  P. 
McQellan,  R.  H. 
Redfield,  A  H. 
Remsen,  D.  S. 
Schouler,  J. 

Schouler,  J. 
Sprague,  C.  E. 
Underbill,  H.  C. 
Wolfe,  S.  H. 


TITLE 

Theory  and  Practice  of  Estate  Accounting, 


The  Law  of  Decedents'  Estates. 

Accountant's    Guide    for    Executors,    Adminis- 
trators, etc. 

Accounts  of  Executors  and  Testamentary  Trus- 
tees. 

Procedure  and  Law   of  Surrogates'   Courts  of 
the  State  of  New  York. 

The  Care  of  Estates. 

The  American  Law  Relating  to  Principal  and 
Income. 

The  Law  and  Practice  in  the  Surrogate  Courts 
in  the  State  of  New  York. 

A  Trustee's  Handbook. 

The  Executor's  Guide. 

Law  and  Practice  of  Surrogates'  Courts. 

A  Treatise  on  the  Law  of  Wills. 

A  Treatise  on  the  Law  of  Executors  and  Ad- 
ministrators. 

A  Treatise  on  the  Law  of  Wills. 

Philosophy  of  Accounts. 

A  Treatise  on  the  Law  of  Wills. 

Inheritance  Tax  Calculations. 
92 


Fiduciary  Accounting 


QUESTIONS  AND  PROBLEMS 

I.  Define:  Executor,  administrator,  trustee,  administrator- 
cum-textamento-annexo ;  administrator  de  bonis  non ;  guardian  ; 
guardian  pendente  lite;  testamentary  trustee;  will;  testator; 
intestate ;  assets  ;  debts ;  legacy ;  specific  legacy ;  demonstrative 
legacy ;  general  legacy ;  lapsed  legacy ;  residuary  legacy ; 
codicil ;  letters  of  administration  ;  executor  de  son  tort ;  income ; 
commission ;  testamentary  trust ;  inter  vivos  trust ;  surrogate ; 
intermediate  accounting;  final  accounting;  judicial  settlement; 
property  ;  real  property ;  personal  property ;  heirs-at-law ;  next- 
of-kin  ;  life  tenant ;  remainderman ;  administrator  pendente  lite ; 
dower;  estate  by  courtesy;  executrix;  administratrix. 

2.  What  is  necessary  to  the  valid  execution  of  a  will? 
Of  a  codicil?  How  many  witnesses  are  necessary  to  the  valid 
execution  of  a  will?  Of  a  codicil?  What  qualifications  as  to 
age  does  the  statute  require?  Is  your  answer  the  same  for 
both    real   and   personal    property? 

3.  What  is  an  olographic  will?  A  nuncupative  will? 
What  are  the  statutory  requirements  relative  to  such  wills? 
Can  a  legatee  be  a  witness  to  a  will?  What  are  the  statutory 
requirements  where  corporations,  partnerships  and  non-resi- 
dents are  appointed  executors? 

4.  W^hat  is  the  source  of  an  executor's  authority?  Of 
an  administrator's  authority?  What  is  meant  by  the  expres- 
sion, "the  executor  has  qualified"  ? 

5.  What  are  the  duties  of  an  executor  named  in  a  will 
during  the  interval  between  the  death  of  the  testator  and  the 
issue  of  letters  testamentary? 

6.  What  procedure  should  be  followed  by  a  person  named 
as  executor  who  does  not  wish  to  serve?  May  an  executor 
resign?    If  an  executor  renounces  may  he  retract? 

7.  Where  more  than  one  executor  is  named,  may  all  act? 
If  one  dies  or  resigns,  what  happens?  Who  should  settle  the 
accounts  of  a  deceased  executor?  Are  executors  responsible 
for  each  other's  neglect  or  default? 

8.  Must  an  executor  give  bonds?    For  what  reasons  may 

93 


Fidu  ciary  Ac  conn  ting 

an  executor  be  removed?  State  the  statutory  requirements 
relative  to  surety  bonds  of  executors.  Who  should  pay  for 
the  cost  of  surety  bonds  ? 

9.  When  must  the  several  executors  act  jointly?     Are 
the  requirements  for  joint  action  the  same  for  trustees? 

10.  What  is  the  first  duty  of  an  executor?  Must  an 
executor  file  an  inventory?  Should  real  property  be  included 
in  the  inventory?  State  the  rule  regarding  real  and  personal 
property  located  outside  the  State.  What  law  of  place  governs 
in  the  case  of  the  disposition  of  real  and  personal  property  by 
will? 

11.  What  are  the  executor's  duties  relative  to  the  follow- 
ing: Debts  due  to  the  estate;  debts  due  by  the  estate;  taxes 
on  the  estate? 

12.  What  form  and  arrangement  should  be  followed  in  pre- 
paring the  inventory? 

13.  What  books  of  account  should  an  executor  keep? 
What  steps  would  you  take  in  opening  a  set  of  books  for  an 
executor?  How  should  an  executor  handle  funds  in  his  pos- 
session ;  is  an  executor  responsible  for  the  failure  of  a  bank  in 
which  he  has  deposited  funds  of  the  estate?  Is  the  executor 
responsible  for  property  of  the  estate  stolen  from  him?  To 
what  should  he  charge  such  a  loss — corpus  or  income?  How 
should  an  executor  sign  checks  or  papers? 

14.  Does  a  judgment  obtained  against  the  executor  in  his 
official  capacity  bind  him  personally?  Does  it  affect  the  real 
property  of  the  estate?  Can  an  executor  bind  an  estate  by 
contracts  entered  into  in  his  official  capacity?  Would  the 
answer  be  the  same  if  (the  executor  personally  made  no 
profits  on  the  transaction?  May  an  executor  purchase  any 
property  of  the  testator?  Can  an  executor  take  credit  in  his 
accounting  for  expenses  incurred  for  the  following:  counsel 
fees ;  auctioneer  in  sale  of  property ;  bookkeeper  for  the  estate ; 
an  agent;  accountant's  service  in  preparing  his  accounts?  Is 
an  executor  responsible  for  the  acts  of  an  agent  he  employs 
on  estate  matters,  and  how  may  he  protect  himself?  What 
general  rule  may  be  laid  down  relating  to  expenses  incurred  by 
an  executor  in  behalf  of  the  estate  ? 

15.  What  is  an  executor's  duty  in  the  matter  of  debts  due 
to  the  estate?    Is  an  executor  ex-officio  a  partner  in  the  firm 

94 


Fiduciary  A c counting 

in  which  the  testator  was  a  partner?  Has  he  a  right  to 
examine  the  books  of  the  partnership?  May  he  sue  for  an 
accounting  of  the  testator's  interest  therein?  If  this  suit  or 
any  suit  for  the  recovery  of  a  debt  due  to  the  estate  should 
fail,  is  the  executor  chargeable  for  the  costs  thereof?  Are 
lawsuits  brought  by  the  testator  in  his  lifetime  to  be  continued 
by  his  personal  representative? 

i6.  A  B  dies ;  it  is  found  that  on  the  dissolution  of  a  part- 
nership in  which  A  B  was  a  partner,  there  is  not  sufficient 
firm  property  to  pay  the  firm  debts,  but  that  there  are  other 
living  solvent  partners.  What  obligations  attach  to  the  estate 
of  A  B?  Suppose  that  there  were  no  living  solvent  partners? 
State  the  rights  of  A  B's  personal  creditors  and  next-of-kin 
in  the  above  cases? 

17.  Upon  the  dissolution  or  sale  of  the  business  of  a  co- 
partnership, is  the  estate  of  the  deceased  partner  entitled  to 
share  in  the  profits  derived  from  the  sale  of  the  goodwill  or 
firm  name?  If  so,  in  what  proportion — as  per  capital  con- 
tribution or  as  per  share  of  profits  allowed  under  the  articles 
of  co-partnership? 

18.  Can  a  sole  surviving  partner  of  an  insolvent  firm  make 
a  general  assignment  of  its  assets  without  the  consent  of  the 
executor  of  the  deceased  partner?  When  may  an  executor 
compel  the  surviving  partners  to  pay  over  to  him  the  interest 
of  the  testator  in  the  firm?  If  the  testator  made  his  partners 
the  executors  of  his  will  may  they  purchase  the  interest  of  the 
deceased  partner  therein? 

19.  If  the  testator  should  make  a  person  the  devisee  of  his 
interest  in  a  co-partnership,  would  such  devisee  become  a 
partner?  Is  an  executor  justified  in  accepting  an  informal 
accounting  from  surviving  partners  ? 

20.  Jones,  an  executor,  allows  the  funds  of  an  estate  to 
remain  invested  in  the  business  of  a  co-partnership  of  which 
the  testator  was  a  member;  the  firm  fails  subsequently.  Is 
the  executor  liable?  If  there  was  express  authority  in  the  will 
permitting  the  executor  to  do  this,  would  your  answer  be  the 
same?  When  the  articles  of  co-partnership  and  the  will  con- 
flict in  a  matter  concerning  the  partnership  interest,  which 
governs  ? 

21.  State  the  provisions  of  the  code  relative  to  the  follow- 

95 


Fiduciary  Acccunting 

ing  matters :  appointment  of  appraisers  and  appraisal ;  con- 
tents of  the  inventory;  return  of  the  inventory;  discovery  pro- 
ceedings; ascertainment  of  debts. 

22.  What  are  deemed  assets  ?  State  the  rules  for  the  appor- 
tionment of  rents,  annuities  and  dividends. 

23.  The  executor  is  compelled  to  purchase  real  estate  upon 
the  foreclosure  of  a  mortgage  held  by  the  estate ;  are  the  pro- 
ceeds personalty  or  realty?  The  testator  contracted  to  pur- 
chase realty  during  his  lifetime  and  paid  down  part  of  the 
price  as  earnest  money;  should  the  executor  pay  the  unpaid 
balance?  When  the  transaction  is  completed  is  such  property 
considered  as  realty  or  personalty?  The  testator  contracted 
to  sell  realty  and  part  of  the  purchase  price  had  been  paid  to 
him  by  the  purchaser;  when  the  balance  due  is  paid,  are  the 
proceeds  treated  as  realty  or  personalty?  If  a  mortgage  held 
by  the  estate  is  foreclosed  by  the  executor  and  realizes  a  sur- 
plus, to  whom  does  surplus  belong?  If  a  mortgage  on  prop- 
erty of  the  decedent  is  foreclosed  and  realizes  a  surplus,  to 
what  class  of  property  does  such  surplus  belong? 

24.  Among  the  testator's  assets  is  some  part-paid  stock  of 
the  Jones  Company;  w^ould  the  estate  be  liable  for  the  debts 
of  this  company  ?  Can  the  executor  compel  a  corporation  upon 
receipt  of  proper  credentials  to  register  stock  in  his  official 
name?  Can  the  executor  vote  on  stock  even  though  the 
formality  of  transferring  it  to  his  name  as  executor  on  the 
books  of  the  company  has  not  been  complied  with? 

25.  What  are  the  executor's  duties  in  the  matter  of  specific 
legacies?  Must  he  pay  interest  on  a  specific  legacy?  Can  a 
bequest  of  money  ever  be  a  specific  legacy?  What  happens 
if  the  testator  has  disposed  of  the  specific  legacy?  What  is 
meant  by  the  term  '"increment"  when  used  in  connection  with 
a  specific  legacy?  What  arrangement  is  usually  made  for  the 
collection  of  the  transfer  tax  on  a  legacy?  Can  an  executor 
ever  sell  a  specific  legacy,  and  if  so,  how  must  it  be  sold? 

26.  What  is  meant  by  a  lapsed  legacy  and  how  should  it 
be  treated? 

2y.  Define  and  differentiate  the  following  terms :  Specific 
legacy ;  demonstrative  legacy ;  general  legacy ;  absolute ;  condi- 
tional; contingent;  general  legacy  in  income.  When  must  an 
executor  pay  legacies?     If  the  will  provided  that  a  certain 

96 


Fiduciary  Accoun ting 

legacy  be  paid  immediately  upon  issuance  of  letters  testamen- 
tary is  the  executor  bound  to  do  so? 

28.  What  recourse  has  legatee  to  compel  the  payment  of 
a  legacy  before  the  legal  time?  What  is  the  usual  order  of 
payment  of  legacies  ?  What  happens  if  there  are  not  sufficient 
assets  to  pay  all  legacies?  What  recourse  has  a  legatee  to 
compel  the  payment  of  a  legacy  after  the  legal  time? 

29.  When  paying  legatees,  what  must  the  executor  do  in 
the  matter  of  the  inheritance  tax?  State  the  treatment  in  the 
account  of  proceedings  of  payments  of  the  inheritance  tax 
made  on  legacies  where  such  taxes  are  not  made  charges 
against  the  estate  under  the  terms  of  the  will. 

30.  What  transfers  are  taxable  under  the  Inheritance  or 
Succession  Tax? 

31.  Is  the  surrender  of  a  certificate  of  stock  held  by  a 
deceased  person  for  issuance  in  the  name  of  his  executor  or 
administrator  taxable  under  the  Stock  Transfer  Tax  Law? 
Are  transfers  of  stock  made  by  an  executor  or  administrator 
to  trustees,  legatees,  or  other  persons,  taxable  under  the  Stock 
Transfer  Tax  Law?  If  the  executor  should  surrender  a  cer- 
tificate of  stock  for  reissue  in  part  to  himself,  as  executor, 
and  in  part  to  a  trustee,  legatee,  or  other  person,  what  is  the 
rule  as  to  the  payment  of  the  stock  transfer  tax? 

32.  Who  is  responsible  for  the  payment  of  the  Inheritance 
or  Succession  Tax  ?  What  law  governs  in  assessing  the  tax — 
the  law  in  effect  at  date  of  death,  or  the  law  in  eflfect  at  the 
time  of  appraisal — for  the  purpose  of  determining  the  amount 
of  the  tax  ?  What  liability  would  an  executor  incur  if  he  failed 
to  see  to  the  matter  of  payment  of  the  tax?  Is  there  any 
advantage  in  paying  this  tax  at  any  special  time?  If  so,  and 
such  advantage  was  lost  through  non-payment,  to  whom  would 
responsibility  attach? 

33.  What  is  the  rule  for  the  payment  of  taxes  on  realty 
which  the  testator  died  seized  of?  What  is  the  rule  as  to  the 
payment  of  taxes  on  personalty?  When  and  how  are  such 
taxes  assessed  in  the  City  of  New  York  ?  What  are  the  duties 
and  remedies  of  the  executor  when  assessments  are  considered 
too  high?  What  responsibilities  arise,  and  to  whom  attached, 
if  taxes  are  not  paid  promptly? 

34.  Are  there  any  other  inheritance  taxes  payable,  and,  if 
so,  under  what  conditions  are  they  payable? 

97 


Fiduciary  Accounting 

35.  If  the  executor  is  the  sole  legatee  of  the  testator,  does 
he  personally  own  the  decedent's  property?  If  there  is  prop- 
erty of  the  decedent  in  existence  of  merely  a  personal  nature, 
and  of  value  only  as  heirlooms,  or  of  value  only  to  friends 
and  relatives  of  the  deceased,  must  the  executor  sell  such 
property?  If  there  is  personal  property  not  specifically  be- 
queathed in  the  will,  how  should  the  executor  dispose  of  it? 

36.  What  are  the  functions  of  an  administrator  durante 
minor e  aetatef    Administrator  ad  colligendum f 

37.  What  situation  would  call  for  the  appointment  of  an 
administrator  de  bonis  non  cum  textamento  annex  of 

38.  What  do  you  understand  by  redeemable  and  irredeem- 
able rents? 

39.  What  is  meant  by  the  term  ''advances,"  and  how  are 
such  treated  in  the  accounting? 

40.  How  should  the  executor  proceed  to  ascertain  the  debts 
due  by  the  testator?  State  the  order  of  priority  of  the  differ- 
ent classes  of  debts.  What  is  the  executor's  duty  in  the  mat- 
ter of  claims  he  believes  to  be  valid  as  to  proof?  If  an  executor 
rejects  a  claim  against  the  estate,  and  the  creditor  later  recov- 
ers judgment,  is  the  executor  personally  liable,  and  is  he  allowed 
to  spend  the  assets  in  contesting  a  claim  he  believes  invalid? 
Within  what  time  must  a  creditor  commence  action  on  a  claim 
rejected  by  the  executor?  At  what  time  should  the  executor 
commence  to  pay  creditor's  claims,  and  why?  What  is  the 
procedure  in  the  matter  of  doubtful  claims,  and  what  dispo- 
sition is  made  of  the  costs  of  such  proceedings?  Could  the 
executor  compromise  a  debt? 

41.  Must  the  executor  take  receipts  from  creditors?  What 
claims  against  the  estate  should  be  paid  in  cash? 

42.  Should  the  executor  pay  a  debt  barred  by  the  Statute 
of  Limitations?  Would  your  answer  be  different  if  the  testa- 
tor specified  in  his  will  that  the  debt  be  paid?  When  does 
the  Statute  of  Limitations  begin  to  run?  When  is  a  simple 
contract  debt  against  the  decedent  barred  absolutely?  During 
what  period  must  an  action  for  damages  to  personal  property 
be  commenced?  Suppose  the  executor  found  a  debt  due  to  the 
testator  which  he  felt  was  just,  and  to  the  best  of  his  knowl- 
edge and  belief  would  have  been  paid  by  the  testator  if  he 
were  alive;  however,  the  executor  knows  of  a  technical  legal 

98 


Fidu ciary  Accoun ting 

defense,  which,  if  put  forward,  would  defeat  the  claim  of 
the  creditor;  should  he  pay  the  debt?  What  happens  to  the 
claim  of  a  creditor  not  presented  to  the  executor  after  six 
months  of  public  advertising  ?  Could  the  creditors  of  an  estate 
ever  prevent  the  payment  of  a  bequest  of  a  debt  due  by  the 
executor  to  the  estate?  Must  a  creditor  always  sue  to  collect 
a  debt  due  by  the  estate?  When  should  the  executor  pay  a 
debt  to  him  by  the  estate? 

43.  What  is  meant  by  the  term  "power  of  sale"?  How 
may  such  power  be  conferred  on  executors  and  trustees? 
What  advantage  is  there,  if  any,  in  giving  this  power  of  sale 
to  executors? 

44.  If  a  widow  is  given  a  bequest  in  lieu  of  dower,  or  an 
executor  in  lieu  of  commissions,  must  they  accept? 

45.  What  are  ancillary  letters,  and  when  are  they  required? 

46.  What  is  the  Statute  of  Distribution?  When  does  it 
apply  ? 

47.  What  is  the  Statute  of  Descent?    When  does  it  apply? 

48.  What  is  meant  by  a  voluntary  accounting?  State  the 
usual  procedure  of  an  accounting.  What  is  meant  by  an 
intermediate  account?  When  may  an  executor  file  his  inter- 
mediate account?    When  can  he  be  compelled  to  file  it? 

49.  Who  may  object  to  the  executor's  accounting?  Who 
bears  the  expense  of  the  accounting?  May  one  of  several 
executors  file  a  separate  account?  In  a  small  estate,  where 
all  the  parties  are  agreed,  and  the  estate  can  be  settled  easily, 
to  the  satisfaction  of  all  interested  parties,  is  it  necessary  or 
advisable  for  the  executor  to  file  an  accounting? 

50.  What  is  meant  by  the  term,  "judicial  settlement"? 
When  may  an  executor  apply  to  have  his  accounts  judicially 
settled?  When  may  he  be  compelled  to  have  his  accounts 
judicially  settled?  When  the  final  decree  has  been  issued  is 
it  conclusive  of  all  matters  mentioned  in  the  account? 

51.  Should  an  executor  employ  a  competent  attorney  to 
assist  him  in  the  management  of  the  estate  ? 

52.  Where,  under  a  power  of  sale  in  a  will,  an  executor 
sells  real  estate,  what  kind  of  a  deed  does  he  give?  Is  this 
a  clear  title  ?  When  may  he  sell  real  estate  free  of  all  claims  ? 
May  an  executor  sell  real  property  to  pay  debts  ? 

53.  Is   the   purchaser   of   personal   property   protected   in 

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Fiduciary  Accounting 

buying  from  an  executor?     Would  your  answer  be  the  same 
if  the  executor  stole  the  funds  obtained  from  such  sale? 

54.  Where  there  are  several  executors,  which  one  has 
possession,  physically,  of  the  assets?  Can  the  power  of  the 
executor  be  delegated? 

55.  Does  the  signing  by  an  executor  of  a  document  ''as 
executor"  relieve  him  of  personal  responsibility  in  cases  where 
he  has  exceeded  his  authority? 

56.  May  artificial  persons  act  as  executors? 

57.  A  testator  bequeathes  certain  property  by  will  to  a 
corporation;  it  is  found  that  the  corporation  holds  at  present 
all  the  property  allowed  by  law.  Should  the  executor  pay 
the  bequest?  If  the  gift  was  made  to  a  corporation,  and  the 
exact  corporate  name  was  not  used  by  the  testator,  how  should 
the  executor  act?  If  the  corporation  has  gone  out  of  exist- 
ence prior  to  the  death  of  the  testator,  what  becomes  of  the 
legacy  ?  Suppose  a  legacy  had  been  left  to  an  unknown  person, 
what  would  become  of  it? 

58.  Could  a  legatee  renounce  a  legacy?  The  testator  gives 
a  legacy  to  an  infant ;  to  whom  should  the  executor  make 
payment  ? 

59.  A  testator,  in  making  his  will,  provided  that  a  certain 
legacy  should  be  made  a  charge  on  his  real  estate ;  how  would 
this  affect  his  real  property?  If  the  legatee  died  before  pay- 
ment, what  would  the  situation  be? 

60.  Does  a  provision  in  a  will  that  legatees  shall  forfeit 
bequests,  in  event  of  a  contest  by  them  of  the  will,  usually  hold 
good? 

61.  What  is  meant  by  abatement?  What  legacies  are  sub- 
ject to  abatement? 

62.  Explain  what  is  meant  by  the  revocation  of  a  will. 
What  circumstances  operate  to  revoke  a  will? 

63.  What  is  meant  by  the  term,  ''executing  a  will"  ?  What 
in  general  may  be  said  concerning  the  competency-  of  witnesses  ? 
What  is  the  attestation  clause?  Is  it  necessary?  Must  a  will 
be  sealed? 

64.  What,  in  general,  are  the  investments  which  trustees 
are  allowed  to  make  ?  Should  a  trustee  who  takes  over  invest- 
ments, not  legal  investments  for  trusts  in  this  state,  reinvest 
such  principal?  State  the  general  principles  governing  invest- 
ments of  trustees  in  mortgages,  bonds,  stocks,  real  estate. 

100 


Fiduciary  Accounting 

65.  Where  is  the  property  of  a  trust  taxable?  When 
may  a  trustee  voluntarily  file  his  account?  When  may  he 
be  compelled  to  file  an  account?  When  a  trustee  dies,  who 
settles  his  accounts?  When  may  a  trustee  judicially  settle  his 
accounts  ?    Voluntarily  ?     Involuntarily  ? 

66.  How  does  an  executor  receive  his  compensation,  and 
on  what  basis  is  it  calculated?  Is  the  commission  the  same 
for  administration  ?  For  a  trustee  ?  If  there  are  two  or  more 
executors,  does  each  one  receive  a  commission?  Where  a 
trustee  is  also  executor,  is  he  entitled  to  commission  in  both 
capacities?  Is  an  executor  entitled  to  any  commission  before 
he  makes  an  accounting?  Is  a  trustee  entitled  to  any  com- 
mission before  he  makes  an  accounting? 

67.  Where  a  trustee  has  been  guilty  of  misconduct  is  he 
entitled  to  commission? 

68.  Dififerentiate  between  an  executor  and  trustee. 

69.  What  is  the  authority  of  a  general  guardian?  A  spe- 
cial  guardian?     Their   respective   rights   and   duties? 

70.  When  must  a  general  guardian  file  an  accounting? 
What  restrictions  apply  to  the  investments  of  guardians  ? 

71.  Can  an  executor  make  investments?  Is  he  required 
to  make  investments?  Is  an  executor  responsible  for  loss  on 
investments  ? 

72.  The  residue  of  a  man's  personal  property  is  $36,(XX).oo. 
There  remain  a  widow,  three  children,  and  three  grandchildren 
whose  parent  is  dead.  What  portion  of  the  residue  will  each 
person  receive? 

73.  The  residue  of  a  man's  personal  property  is  $24,000.00. 
He  leaves  a  widow  and  four  children  to  share  in  the  residue. 
He  advanced  to  one  of  the  children  during  his  lifetime  the 
sum  of  $6,000.00.     What  shall  each  receive? 

74.  The  residue  of  a  man's  estate  amounts  to  $24,000.00. 
He  left  no  children,  grandchildren,  or  father,  but  did  leave 
a  widow,  mother,  a  brother  and  a  sister,  and  two  nephews 
whose  parent  is  dead.    How  is  the  property  to  be  divided? 

75.  The  testator  of  a  will  left  $21,000.00.  He  leaves  a 
widow  and  three  children.  To  one  of  the  children  he  had 
advanced  during  his  lifetime  the  sum  of  $9,000.00.  What 
would  each  receive? 

76.  What  is  a  gift  causa  mortis f  What  is  necessary  to 
make  it  effective? 

lOI 


Fiduciary  Accounting 

yy.  What  authority  has  the  executor  in  regard  to  real  es- 
tate ?  When  may  he  rent  real  estate  and  collect  rents  ?  When 
may  an  executor  sell  or  mortgage  real  estate,  if  the  will  con- 
tains no  express  provision  to  do  so?  What  general  rule  may 
be  laid  down  relative  to  powers  of  sale  of  real  estate  under 
a  will,  and  what  steps  should  an  executor  take  to  protect 
himself?  What  is  meant  by  an  "executor's  deed"?  Must  all 
of  several  executors  unite  in  selling  real  estate  and  giving 
good  title?  Has  the  executor  an  insurable  interest  in  the  real 
estate  of  the  testator?  Is  it  his  duty  to  insure  such  real  prop- 
erty ?  How  should  executors  sign  deeds  of  real  estate  ?  Would 
the  executor's  insurable  interest  in  real  estate  of  the  decedent 
depend  upon  whether  the  testator  was  solvent  or  insolvent? 
What  are  the  executor's  duties  relative  to  leasehold  interests 
of  the  testator  ?  How  are  such  leaseholds  valued  for  inventory 
or  tax  purposes?  What  is  the  rule  relative  to  the  apportion- 
ment of  rents? 

78.  Is  a  local  assessment  apportionable  between  life  tenant 
and  remainderman?    Explain. 

79.  A  policy  of  insurance  contains  a  clause  exempting  the 
company  from  liability  if  the  insured  premises  remain  idle 
or  vacant  20  days  without  the  permission  of  the  company, 
indorsed,  in  writing,  on  the  policy.  A  policyholder  applies 
to  the  agent  who  issued  the  policy  for  such  permission,  and 
the  agent  gives  permission  orally,  saying  that  the  written 
consent  of  the  company  is  not  necessary.  The  insured  build- 
ing burns.  The  owner  sues  the  company.  In  whose  favor 
should  judgment  be  rendered?    Why? 

80.  When  a  fund  is  directed  to  be  invested,  and  the  inter- 
est, dividends  and  income  applied  to  the  use  of  the  beneficiary 
for  Hfe,  does  a  profit  realized  on  the  sale  of  stock  in  which 
a  portion  of  such  fund  is  invested  belong  to  the  life  tenant,  as 
income,  or  go  to  the  body  of  the  estate?  State  the  general 
rules  of  law  which  govern? 

81.  An  estate  with  a  life  tenancy  consists  in  part  of  shares 
in  a  certain  corporation  that  has  voted  to  increase  its  capital 
stock.  Would  the  proceeds  of  a  sale  of  the  right  to  subscribe 
for  the  estate's  quota  of  this  new  issue  go  to  the  life  tenant 
or  to  the  body  of  the  estate?    Explain. 

82.  In  what  case  may  the  executor  recover  damages  from 

102 


Fiduciary  Accounting 

one  who  has  neghgently  inflicted  personal  injuries  upon  the 
testator?  Does  the  amount  become  a  part  of  the  estate,  and 
to  whom  should  the  executor  make  payment? 

S^.  James  Brown,  executor  of  the  will  of  George  Brown, 
deceased,  is  preparing  to  file  his  first  and  final  account,  and 
has  the  following  accounts  on  his  books,  representing  the  com- 
pleted transactions  of  his  executorship : 

DEBTOR  CREDITOR 

$10,000  P.R.R.  43/^s  (appraisal) $10,500.00 

Income $450.00 

$10,000  Market  St.  Ry.  4s  (appraisal 

and  sale) 10,000.00       10,500.00 

Income 200.00 

$5,000  B.  &  O.  3>^s  (cost) 4,900.00 

Income i5-00  87.50 

Co-partnership    of    Brown    &    Davis 

(proceeds) 30,000.00 

Interest  on  bank  balances 250.00 

Furniture  (appraisal  and  sale) 800.00         1,000.00 

Horses,  carriages,  etc.  (appraisal  and 

sale)   1,600.00         1,500.00 

Decedent's  debts,  funeral  exp.,  etc. .         3,500.00 

Safe  deposit  box  rent 10.00 

Counsel  fee  and  court  costs 2,185.13 

Estate   of   George    Brown,    deceased 

(appraisal)    22,900.00 

James  Brown,  account  distribution . . .  3,000.00 
George  Brown,  Jr.,  account  distribut'n  3,000.00 
John  Brown,  account  distribution ....         3,000.00 


$42,510.13 
Cash 24,377.37 


$66,887.50    $66,887.50 

Prepare  the  summary  account  of  the  executor.  The  heirs 
are  James  Brown,  George  Brown,  Jr.,  and  John  Brown,  to 
whom,  under  the  will,  the  executor  is  directed  to  distribute  the 
estate  in  equal  shares. 

103 


Fiduciary  A ccoun ting 

84.  Frederica  Ward  dies,  leaving  one  daughter,  Doris,  and 
two  sons,  Henry  and  Arthur,  all  of  age,  surviving  her.  Her 
will  directs  that  after  the  discharge  of  all  claims  on  her 
estate  there  shall  be  placed  in  trust  for  Frederica  Winter,  the 
child  of  her  deceased  sister,  $50,000.00,  the  income  of  which 
is  to  be  used  for  the  child's  support  by  the  guardian  appointed 
under  the  trust,  and  the  principal  to  be  paid  over  to  her  when 
she  becomes  of  age.  The  remainder  of  the  estate  is  to  be 
divided  equally  among  the  testator's  three  children. 

The  estate  consists  of  cash  in  a  trust  company,  $12,500.00; 
bonds  and  mortgages  on  real  estate,  $250,000.00;  registered 
municipal  bonds,  $90,000.00 ;  household  furniture,  appraised  at 
$20,130.00;  horses  and  carriages,  appraised  at  $3,000.00;  cloth- 
ing, appraised  at  $2,200.00;  and  jewelry,  appraised  at  $7,400.00. 

One  of  the  aforesaid  mortgages,  $51,000.00  at  5%,  is  in 
arrears  of  interest  for  one  year,  and  foreclosure  proceedings 
are  commenced  by  the  executor,  with  the  result  that  on  imme- 
diate settlement  the  estate  realizes  the  principal,  and  interest 
so  in  arrears,  and  the  trust  fund  is  paid  over  to  the  guardian 
of  Frederica  Winters.  The  February  and  August  semi-annual 
instalments  of  interest  at  5%  on  the  two  remaining  mortgages 
of  $100,000.00  each,  and  the  January  and  July  interest  on  the 
registered  4%  bonds,  are  all  duly  received,  and  the  bonds  are 
forthwith  sold  for  $90,190.00. 

The  executor  then  pays  $30,000.00  to  Doris,  and  $10,000.00 
each  to  Henry  and  Walter,  respectively,  on  account  of  their 
interests.  Doris  takes,  as  part  of  her  legacy,  household  furni- 
ture, $5,000.00;  clothing,  $900.00;  and  all  the  jewelry  at  the 
appraised  valuation.  Each  of  the  sons  takes,  as  part  of  his 
legacy,  one  of  the  remaining  bonds  and  mortgages. 

On  the  sale  of  the  remaining  effects,  the  furniture  realizes 
$15,000.00,  the  clothing  $1,000.00,  and  the  horses  and  car- 
riages $3,200.00.  There  is  also  received  from  the  trust  com- 
pany, for  interest  on  deposit,  $350.00.  The  executor  expended 
for  probate,  $150.00;  funeral,  $600.00;  monument,  $1,000.00; 
tax  on  personal  estate,  $350.00;  counsel  fees,  $1,500.00;  fire 
insurance,  $32.00;  and  sundry  claims  against  the  estate,  $7,- 
201.00.  The  allowance  for  executor's  fees  was  fixed  by  the 
will  at  $2,500.00. 

Prepare  a  summary  accounting,  'showing  the  cash  in  hands 
of  executor  and  the  amount  payable  to  each  of  the  heirs. N 

104 


Fiduciary  Accounting 

u; 

85.  John  Smith  died  July  i,  1909,  leaving  a  will  in  which 
he  devised  to  his  widow  one-half  of  the  principal  of  his 
personal  property  and  one-half  the  income  from  all  sources, 
and  the  balance  of  the  estate  to  his  executors,  in  trust  for  cer- 
tain annuitants.  At  the  time  of  his  death  his  estate  consisted 
of  the  following  items : 

1,000  shares  Clarion  Co.  stock,  at  200 $200,000.00 

5,000  shares  Penn.  R.  R.  stock,  at  70 350,000.00 

10,000  shares  U.  S.  Steel  Pfd.,  at  90 900,000.00 

$1,450,000.00 
Interest  in  firm  of  Smith  &  Jones,  as  shown  by 

the  books  of  said  firm,  July  i,  1909 185,000.00 

A  total  of $1,635,000.00 

At  said  date,  July  i,  1909,  the  assets  and  liabilities  of  the 
firm  of  Smith  &  Jones  were  as  follows : 

Assets : 

Merchandise   $50,000.00 

Accounts  receivable 175,000.00 

Real  estate 300,000.00 

Ground  rents 30,000.00 

Mortgages 160,000.00 

Cash 35,000.00 

$750,000.00 

Liabilities : 

Smith $185,000.00 

Jones 235,000.00 

Clarion  Co 330,000.00 

$750,000.00 

The  decedent's  estate  was  not  appraised  until  January  i, 
191  o,  at  which  time  his  interest  in  the  firm  of  Smith  &  Jones 
was  appraised  at  $140,000.00,  the  assets  and  liabilities  of  the 
firm  being  as  follows : 


105 


Fiduciary  Accoun ting 

Assets : 

Accounts  receivable $160,000.00 

Real  estate 200,000.00 

Ground  rent 20,000.00 

Mortgages 100,000.00 

Liabilities : 

Smith $140,000.00 

Jones   140,000.00 

Clarion 200,000.00 


$480,000.00 


$480,000.00 


In  his  account,  filed  in  surrogate's  court,  the  executor 
charged  himself  in  the  principal  account  with  the  sum  of 
$1,590,000.00,  the  value  of  decedent's  stocks,  and  the  appraised 
value  of  his  interest  in  the  partnership;  also  with  the  sum 
of  $100,000.00  for  profits  on  the  1,000  shares  of  stock  of  the 
Clarion  Co.,  accumulated  during  the  lifetime  of  the  decedent, 
and  he  claimed  credit  for  $299,463.92,  paid  on  account  of 
^^  decedent's  debts,  which  sum  included  $100,000.00  due  the 
Clarion  Co.  on  account  of  unpaid  subscription  to  the  1,000 
shares  of  the  stock  of  the  said  company  and  $51,236.08  for 
commissions,  leaving  a  balance  of  $1,339,300.00  due  the  estate, 
consisting  of — 

Cash $574,300.00 

5,000  shares  U.  S.  Steel  Pref 450,000.00 

1,000  shares  Clarion  Co.  stock 200,000.00 

^       Unconverted  assets  of  partnership 115,000.00 


$1,339,300-00 


The  executor  charged  himself  in  the  income  account  with 
receipts  amounting  to  $92,550.00,  no  part  of  which  was  derived 
from  the  partnership,  and  claimed  credit  for  $14,625.00  for 
expenses  and  commissions,  leaving  a  balance  of  $77,925.00  due 
to  the  estate. 

In  the  adjudication  of  the  account  the  surrogate  deducted 
$40,000.00  from  the  principal  account  of  personal  property 
and  transferred  it  to  the  principal  account  of  real  estate;  and 

106 


Fiduciary  Accounting 

he  awarded  the  balance  of  personalty,  after  deducting  $105,- 
000.00  for  unconverted  assets  reserved  for  future  accounting, 
one-half  to  the  widow,  all  of  which  she  received  with  the  excep- 
tion of  $50,000.00  cash,  and  one-half  to  the  accountants  in 
trust  for  the  annuitants ;  and  he  awarded  the  principal  of  the 
realty,  amounting  to  $40,000.00,  $20,000.00  in  trust  to  the 
widow  to  receive  the  income,  and  $20,000.00  to  the  accountants 
in  trust  for  the  annuitants,  and  he  also  awarded  to  the  widow 
income  amounting  to  $38,962.50  and  the  same  amount  to  the 
annuitants. 

After  the  filing  of  the  executor's  account,  it  was  ascertained 
that  of  the  profits  of  the  partnership  between  the  date  of 
Smith's  death  and  the  date  of  appraisement  $10,000.00  was 
derived  from  the  sale  of  real  estate. 

The  executors  now  desire  to  file  a  second  account,  and  it 
appears  that  since  the  filing  of  the  first  account  the  trans- 
actions of  the  partnership  of  Smith  and  Jones  in  liquidation 
have  been  as  follows : 

Accounts  receivable,  charged  to  profit  and  loss  as 

worthless $50,000.00 

Amount  collected  on  accounts  receivable,  charged 
to  profit  and  loss  as  worthless  prior  to 
testator's  death 15,000.00 

Amount     of     interest  collected     on     accounts 

receivable 4,500.00 

Expenses  of  liquidation 3,000.00 

It  also  appears  that  the  amount  of  $200,000.00  appraised 
January  i,  191  o,  as  a  liability  of  the  firm  of  Clarion  Company 
has  been  transferred  on  the  books  of  the  firm  in  equal  parts 
to  the  credit  of  the  separate  accounts  of  Smith  and  Jones,  each 
of  whom  owned  1,000  shares  full  paid  stock  of  said  company 
(the  entire  issue)  on  account  of  profits  on  said  stock  accrued 
prior  to  the  filing  of  the  account. 

Finally  it  appears  that  the  present  value  of  the  interest  of 
decedent's  estate  in  the  partnership,  consisting  of  unconverted 
assets  is  $50,000.00. 

Taking  into  consideration  the  facts  disclosed  in  connection 
with  the  first  adjudication  and  the  subsequent  changes  in  the 

107 


Fiduciary  Accounting 

condition  of  the  estate  set  forth  above,  state  a  second  account 
for  the  executors. 

86.  B  dies  March  23,  1905,  leaving  an  estate  consisting  of 
>    the  follovv^ing  property  in  charge  of  his  executors,  X,  Y  and  Z : 

Cash   in   bank $io,ooo.(X) 


Accounts  receivable  from 
I, 


2 

3 
4 

5 
6 

7 
8 

9 
10 


$2,000.00 
3,000.00 
1,000.00 
3,000.00 
1,000.00 
4,000.00 
2,000.00 
3,000.00 
4,000.00 
1,000.00 

$24,000.00 


Stocks  and  Bonds: 

1.  100   shares    Union    Bank 

(par  value,  $100.00) $12,000.00 

2.  40   shares   Traders   Bank 

value,  $100.00) 12,000.00 

3.  $1,000.00  C.  &  O.,  4's — 

J,  &  J 1 ,050.00 

4.  $5,000.00  P.  R.  R.,  6's — 

M.  &  S 4,500.00 

^5.   $10,000.00  N.  Y.  C,  3>^'s 

—J-  &  J 10,450.00 


$40,000.00 


and  three  parcels  of  unimproved  real  estate. 

Three  of  his  heirs  are  also  indebted  to  him   for  money 
loaned : 


108 


Fiduciary  Accounting 

C    $5,cxx).oo 

D    6,000.00 

E    7,000.00 


$18,000.00 


The  will  directs  the  executors  to  dispose  of  the  real  estate, 
convert  the  other  assets  and  distribute  the  funds,  to-wit: 

Widow one-half 

fc  1 

Children^  D    ^one-sixth  each 

lE    J 

Up  to  April  30,  1906,  the  executors  collected  all  the  accounts 
receivable  with  the  exception  of  items  No.  3,  No.  6  and  No. 
10,  on  which  they  realize  only  $4,500.00,  the  balance  being 
uncollectible. 

Bonds  No.  3  and  No.  5  matured  January  i,  1906,  and  bond 
No.  4  matured  March  i,  1906,  and  were  redeemed  at  par. 
Stock  No.  2  is  sold  at  $325.00  and  Stock  No.  i  at  $125.00, 
both  sales  taking  place  on  April  15,  1905. 

The  real  estate  is  sold  for  cash,  $5,000.00;  and  mortgages, 
$10,000.00.  Interest  has  been  received  on  bank  balances, 
$300.00 ;  accounts  receivable,  $50.00 ;  and  on  each  of  the  bonds 
at  the  regular  interest  periods  in  full : 

The  executors  pay  decedent's  debts  and  funeral  expenses, 
$1,000.00.  Counsel  fees,  $500.00;  safe  deposit  box  rent, 
$To.oo;  and  office  expenses  incident  to  collection  of  income, 
$500.00.  The  executors  waive  their  claim  to  commissions,  but 
ask  for  an  allowance  to  cover  expenses  incurred  by  them  of 
$75.00  each. 

State  the  executors'  first  and  final  account  and  prepare  a 
statement  for  the  purpose  of  guiding  the  court  in  directing  a 
distribution  to  be  made  to  the  heirs. 


109 


GLOSSARY 

ADMINISTRATOR,  a  person  appointed  by  the  surrogate  to 
manage  and  distribute  the  personal  estate  of  a  decedent  who  left 
no  will  or  of  a  testator  who  named  an  executor  unwilling  or  un- 
able to  serve.  TEMPORARY  ADMINISTRATOR,  a  person 
appointed  to  take  charge  of  an  estate  pending  the  appointment  of 
an  executor  or  a  permanent  administrator.  ADMINISTRATOR 
WITH  WILL  ANNEXED  (administrator  cum  testamento 
annexo),  a  person  appointed  by  the  surrogate  to  take  the  place  of 
an  executor  who  has  been  removed  or  who  has  died,  resigned  or 
renounced,  or  to  act  as  executor  of  a  will  where  the  will  itself 
names  no  executor.  ADMINISTRATOR  DE  SON  TORT  (an 
administrator  of  his  own  wrong)  is  one  who  without  legal  authority 
interferes  with  the  management  and  distribution  of  an  estate  at 
his  own  peril. 

ADVANCEMENTS,  a  portion  of  real  or  personal  property 
advanced  to  a  child  of  the  testator  in  the  latter's  lifetime,  clearly 
not  a  gift,  such  advance  to  be  reckoned  in  the  distribution  of  the 
estate. 

AMORTIZATION  is  the  extinguishment  of  a  debt  by  means  of 
a  sinking  fund,  and  in  fiduciary  accounting  means  the  extinguish- 
ment of  the  premiums  paid  by  the  trustees  on  bonds  bought  out  of 
corpus  funds  so  that  at  the  maturity  of  the  bond  the  premium  paid 
will  not  be  lost  and  become  a  charge  against  corpus,  but  that 
during  the  life  of  the  bond  the  life  tenant  shall  receive  only  the 
effective  interest,  that  is,  interest  only  on  the  amount  invested  and 
not  the  fixed  rate  specified  in  the  bond;  the  difference  being  the 
amortization.  ^. 

AMOUNT  is  the  principal  and  interest  taken  together.  ^ 

ANNUITY  is  a  series  of  payments  of  like  amount  per  annum 
made  at  regular  periods;  JOINT  LIFE  ANNUITY  is  one  which  is 
payable  as  long  as  the  parties  continue  to  live  and  ceases  as  soon 
as  one  of  the  lives  makes  its  exit. 

ANCILLARY  LETTERS,  testamentary  or  of  administration, 
as  the  case  requires,  are  issued  when  a  decedent,  either  leaving  a 
will  of  personal  property  proved  without  this  state,  or  dying  in- 
testate not  a  resident  of  this  state,  leaves  personal  property  within 
this  state  to  be  administered. 

ASSETS,  personal  property  applicable  to  the  payment  of  the 
debts  of  a  decedent. 

ASSIGNMENT,  a  transfer  of  rights  or  interests. 

Ill 


Glossary 

ATTESTATION  CLAUSE,  the  certificate  signed  by  the  wit- 
nesses reciting  the  formalities  that  were  performed  at  the  execution 
of  the  will.       ( 

BENEFICIARY,  the  person  entitled  to  receive  the  benefit  of 
a  trust;  also  called  "the  cestui  que  trust." 

BEQUEST,  identical  in  meaning  with  the  word  "legacy"  q.  v. 

CODICIL,  an  amendment  or  postscript  to  a  wiil;  it  may  re- 
voke or  modify  any  of  the  provisions  of  the  will. 

COMMISSION,  the  remuneration  allowed  by  law  to  the 
executor,  administrator  or  trustee  for  managing  and  administering 
an  estate. 

CORPUS,  the  body  or  principal  of  the  estate. 

CREDITOR,  every  person  having  a  claim  or  demand  upon 
which  a  judgment  for  a  sum  of  money,  or  directing  the  payment 
of  money,  could  be  recovered  in  an  action;  any  person  having  a 
claim  for  expenses  of  administration,  or  any  person  having  a  claim 
for  funeral  expenses. 

CURTSEY  is  a  life  estate  to  which  by  common  law,  as  modi- 
fied by  the  Married  Women's  Acts,  a  man  is  entitled  on  the  death 
intestate  of  his  wife  in  the  land  or  tenements  of  which  she  was 
seized  in  possession,  in  fee  simple  at  the  time  of  her  death,  pro- 
vided they  had  lawful  issue  born  alive  which  might  have  been 
capable  of  inheriting  the  estate. 

DEBTS,  every  claim  and  demand  upon  which  a  judgment  for 
a  sum  of  money,  or  directing  the  payment  of  money,  could  be 
recovered  in  an  action. 

DEVISE,  a  gift  of  real  property  by  will 

DOWER,  an  estate  for  the  term  of  her  life,  passing  by  operation 
of  law  to  the  widow  of  a  decedent  in  the  third  part  of  all  the  lands 
whereof  he  was  seized  of  an  estate  of  inheritance  at  any  time  during 
the  marriage.  The  term  dower,  though  properly  applicable  only 
to  real  property,  is  sometimes  loosely  applied  in  wills  or  contracts 
to  a  widow's  share  in  the  personal  property  of  her  husband. 

EXECUTOR,  the  person  named  by  the  testator  in  his  will  to 
whom  he  has  confided  the  duty  of  carrying  out  the  provisions  of 
the  will  and  who  has  been  duly  approved  by  the  surrogate. 

EXECUTRIX,  a  woman  who  acts  in  the  same  capacity  as  an 
executor. 

EXECUTOR  DE  SON  TORT,  a  person  who  without  authority 
wrongfully  takes  upon  himself  the  character  of  an  executor  and 
meddles  in  any  way  with  the  assets  formerly  of  a  deceased  person. 

FORCE  OF  MORTALITY,  "the  proportion  of  persons  at  age 
who  would  die  in  a  year  if  the  intensity  of  mortality  remained  con- 
stant for  a  year  and  if  the  number  of  persons  under  observation 
also  remained  constant,  the  places  of  those  who  die  being  constantly 
occupied  by  fresh  lives."    (Wolfe's  Inheritance  Tax  Calculations). 

GUARDIAN  AD  LITEM,  a  guardian  appointed  by  the  court 
to  represent  an  infant  in  a  legal  action;  also  in  certain  legal  pro- 

1X2 


Glossary 

ceedings  called  special  guardian;  such  guardian  may  only  represent 
the  infant's  interests  in  court  in  the  particular  action  or  matter  in 
which  he  is  appointed. 

GUARDIAN,  GENERAL,  a  person  charged  with  the  care  of 
the  person  or  property  or  both  the  person  and  property  of  an 
infant;  he  is  appointed  either  by  will  or  deed  or  by  the  court  on 
the  nomination  of  proper  parties.  When  appointed  by  will  he  is 
generally  referred  to  as  "testamentary  guardian." 

HEIRS-IN-LAW,  relatives  of  the  deceased  who  succeed  to 
the  real  property  of  a  person  who  leaves  no  will. 

INCOME,  in  fiduciary  accounting,  that  which  is  derived  as 
earnings  from  the  corpus  or  principal  of  the  estate. 

INFANT,  any  person  under  21  years  of  age. 

INTERMEDIATE  ACCOUNT,  an  account  rendered  by  an 
executor  or  administrator  intending  to  disclose  the  acts  of  the 
person  accounting,  and  the  condition  of  the  estate  at  that  time, 
but  not  made  the  subject  of  judicial  settlement. 

INTESTATE,  a  person  who  leaves  no  valid  will;  or  property 
not  effectively  disposed  of  by  will,  whether  the  deceased  left  a 
will  or  not. 

JUDICIAL  SETTLEMENT,  signifies  the  decree  of  the  surro- 
gate whereby  the  executor's  account  is  made  conclusive  in  certain 
respects  upon  the  parties. 

LEASEHOLD  INTEREST,  a  ground  rent  from  the  viewpoint 
of  the  lessee — see  rents. 

LEGACY,  a  gift  of  personal  property  by  will;  a  DEMON- 
STRATIVE LEGACY  is  one  mentioning  unidentified  articles  to 
be  taken  out  of  a  large  identified  mass,  such  as  a  bequest  of  money 
or  the  like  payable  out  of  a  particular  fund  or  security;  a  GEN- 
ERAL LEGACY  is  one  payable  out  of  the  general  assets  of  the 
estate  and  is  a  gift  of  money  or  property  in  quantity  and  not 
specified  in  any  distinct  way;  a  RESIDUARY  LEGACY  is  a  gift 
of  the  residue  of  the  personal  property  remaining  after  all  other 
legacies  provided  for  in  the  will  have  been  paid;  a  SPECIFIC 
LEGACY  is  a  gift  of  specific  property  or  identified  article  which 
has  been  clearly  distinguished  from  all  others  of  the  same  kind. 
LEGACY  LAPSED  is  one  which  fails  by  reason  of  the  death  of 
the  legatee  before  the  death  of  the  testator  where  no  other  words 
are  found  in  the  will  to  prevent  such  a  lapse;  it  pre-supposes  the 
existence  of  such  legacy  and  of  a  legatee.  ADEEMED,  by  the 
destruction  of  the  subject  matter  in  the  lifetime  of  the  testator. 

LEGATEE,  a  person  to  whom  is  given  a  bequest  of  personal 
property  by  will. 

LETTERS  OF  ADMINISTRATION,  the  credentials  of  an 
administrator;  the  expression  includes  letters  of  temporary  admin- 
istration; see  letters  testamentary. 

LETTERS  TESTAMENTARY,  the  written  authority  or 
credentials   of   an    executor   issued   by   the    surrogate    and    which,. 


Glossary 

together   with    the    will,    constitute    the    source    of    the    executor's 
authority. 

LIFE  TENANT,  the  one  who  receives  the  income  derived  from 
corpus  held  in  trust,  or  who  is  entitled  to  the  use  of  property  for 
the  term  of  his  life. 

MORTGAGEE,  a  person  loaning  on  mortgage. 

MORTGAGOR,  a  person  making  a  mortgage. 

NEXT  OF  KIN,  all  persons  entitled  under  the  provisions  of 
law  relating  to  the  distribution  of  personal  property  to  share  in 
the  unbequeathed  personal  property  of  a  decedent  after  the  pay- 
ment of  debts  and  expenses,  other  than  a  surviving  husband  or 
wife. 

POWER  OF  SALE,  authority  given  by  will  to  the  personal 
representative  or  trustee  to  sell  property  of  the  testator. 

PRESENT  WORTH  (THE)  of  a  future  sum  is  a  smaller 
sum  which  put  at  interest  will  amount  to  the  future  sum. 

PROBATE,  the  proving  to  a  court  of  competent  authority  the 
genuineness  of  a  will  and  its  execution  in  compliance  with  the 
requirements  of  the  statute,  so  that  it  may  become  effective  and 
authority  be  thereby  given  to  the  executor. 

PROPERTY,  PERSONAL,  practically  everything  except  real 
property  and  includes  any  right  of  action  conferred  by  law  upon 
an  executor  or  administrator. 

PROPERTY,  REAL,  includes  every  estate,  interest  and  right, 
legal  or  equitable,  in  lands,  tenements,  or  hereditaments,  except 
those  which  are  determined  or  extinguished  by  the  death  of  a  person 
seized  or  possessed  thereof,  or  in  any  manner  entitled  thereto,  and 
except  those  declared  by  law  to  be  assets. 

RATIO  OF  INCREASE.  Add  1  to  the  interest  rate  and  the 
result  is  the  ratio  of  increase. 

REMAINDERMAN,  the  one  to  whom  the  corpus  of  the  fund 
goes  upon  the  death  of  the  life  tenant,  or  at  the  expiration  of  such 
life  tenant's  interest  in  the  trust. 

GROUND  RENTS,  where  a  person  owns  a  piece  of  ground  or 
land  in  fee  simple  and  conveys  the  same  unto  some  party,  reserving 
to  himself  a  certain  fixed  rent  at  certain  intervals  as  a  consideration 
for  making  such  a  conveyance — see  "redeemable"  and  "irredeem- 
able" rents.  IRREDEEMABLE  RENTS,  see  ground  rents,  those 
which  do  not  give  the  lessee  the  privilege  to  redeem.  REDEEM- 
ABLE RENTS,  see  ground  rents,  ground  rents  that  can  be  re- 
deemed or  bought  in  by  the  lessee  from  the  party  to  whom  the 
land  was  conveyed,  at  such  a  sum  as  is  provided  for  in  the  original 
lease.  This  is  usually  done  by  giving  a  certain  rate  per  centum 
at  which  the  same  is  to  be  redeemed. 

RENUNCIATION,  the  written  formal  declination  of  an 
executor  or  trustee  to  serve  as  such. 

TESTATOR,  a  male  person  making  a  will. 

TESTATRIX,  a  female  person  making  a  will. 

114 


Glossary 

TRANSFER  TAX  (sometimes  called  inheritance  or  succession 
tax),  a  tax  imposed  on  the  transfer  of  property  passing  by  will  or 
intestacy. 

TRUST,  in  general,  the  relation  existing  when  property  is 
transferred  by  the  owner  to  another,  or  set  apart  by  himself  to  be 
held  for  the  benefit  of  some  person  other  than  the  holder.  With 
respect  to  real  property,  the  meaning  of  the  term  has  been  by 
statute  limited  and  restricted,  and  has  become  highly  technical; 
TESTAMENTARY  TRUST,  one  created  under  a  will;  INTER 
VIVOS  TRUST,  a  trust  created  between  living  persons. 

TRUSTEE,  a  person  holding  legal  title  to  property  under  an 
obligation  to  apply  it  according  to  terms  of  the  trust  for  another 
person,  the  beneficiary,  q.  v.  TESTAMENTARY  TRUSTEE,  a 
trustee  nominated  in  a  will  to  execute  a  trust,  and  includes  every 
person  except  an  executor,  an  administrator  with  the  will  annexed, 
or  a  guardian  who  is  designated  by  will  or  by  any  competent 
authority,  and  it  includes  such  executor  or  administrator  where  he 
is  acting  in  the  execution  of  a  testamentary  trust  separate  from  his 
functions  as  executor  or  administrator, 

WILL,  a  person's  solemn  declaration  in  legal  form  to  take 
effect  at  his  death,  revocable  during  life,  making  a  disposition  of 
some  or  all  of  his  property,  or  appointing  an  executor,  or  both. 
The  word  "will"  signifies  a  person's  last  will  and  testament  and 
includes  all  codicils.  NUNCUPATIVE  WILL,  an  unwritten  or 
oral  will  disposing  of  personal  property;  soldiers  in  actual  military 
service  or  mariners  at  sea  only  may  make  oral  wills.  HOLOGRAPH 
WILL,  one  written  entirely  in  the  handwriting  of  the  testator. 


115 


THIS  BOOK  IS  DUE  ON  THE  LAST  DATE 
STAMPED  BELOW 

AN  INITIAL  FINE  OF  25  CENTS 

WILL   BE   ASSESSED    FOR   FAILURE  TO    RETURN 
THIS    BOOK   ON    THE    DATE   DUE.    THE   PENALTY 
WILL  INCREASE  TO  50  CENTS  ON  THE  FOURTH 
DAY    AND    TO     $1.00     ON     THE    SEVENTH     DAY 
OVERDUE. 

MAR    1ft    IP'^fi 

tVIAn    XC7     i»oo 

LD  21-100ni-8,'04 

as  37^^ 


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